Best 3-Year Fixed Rate Bonds in the UK (June 2025)

Looking for a reliable, low-risk way to grow your savings with guaranteed returns? A 3-year fixed rate bond could be the perfect fit. These accounts lock in your interest rate for the full term, providing predictable growth without the uncertainty of the stock market.

At Fixed Rate Bond, we make it easy to compare top UK deals and find the best fit for your savings goals.

What Is a 3-Year Fixed Rate Bond?

A 3-year fixed rate bond (also called a fixed-term savings account) is a savings product where you deposit a lump sum for three years in exchange for a fixed interest rate. Your money stays locked in, and in return, you earn a guaranteed return—regardless of market fluctuations.



Key Features:

  • Fixed interest rate – Your returns are locked in from day one.

  • Capital protection – Covered up to £85,000 per provider by the FSCS.

  • Lump-sum deposits – Most bonds require a £1,000+ minimum investment.

  • No early access – Funds typically can't be withdrawn early without penalties.

Best 3-Year Fixed Rate Bonds – UK (June 2025)

We’ve compared the latest offerings for you. Here are the top deals available now:

Provider

Interest Rate (AER)

Minimum Deposit

FSCS Protected?

Vanquis Bank

4.85%

£1,000

✅ Yes

Close Brothers Savings

4.80%

£10,000

✅ Yes

Aldermore Bank

4.75%

£1,000

✅ Yes

Shawbrook Bank

4.70%

£1,000

✅ Yes

Union Bank of India (UK)


4.65%

£5,000

✅ Yes

Always confirm current rates and terms with the provider before investing


Why Choose a 3-Year Term?

  • Better returns than 1- or 2-year options

  • Locked-in rates regardless of economic changes

  • Perfect for medium-term goals – home deposits, weddings, tuition, and more

If you need more flexibility, compare with 1-year fixed rate bonds before deciding.

Pros and Cons

Benefits:

  • Higher interest than most easy-access or notice savings accounts

  • Fixed returns – No surprises over three years

  • FSCS protection up to £85,000 per institution

Drawbacks:

  • No early access – You may lose interest if you withdraw early

  • Inflation risk – Your real return could shrink if inflation spikes

  • Locked rate – You won't benefit from future rate rises during the term

How to Choose the Best 3-Year Fixed Rate Bond

  • Compare rates – Use trusted sites like Moneyfacts or Fixed Rate Bond

  • Check deposit limits – Ranges from £1,000 to £10,000+

  • Verify FSCS protection – Your safety net in case of provider failure

  • Align with your goals – Will you need this money sooner?

  • Look at provider reputation – Read reviews before committing

FAQs – 3-Year Fixed Rate Bonds

Q1: Can I withdraw money early?
 Typically no – early access often leads to penalties or lost interest.

Q2: Are fixed-rate bonds safe?
 Yes, as long as they’re FSCS-protected, your money is secure up to £85,000 per provider.

Q3: What happens at maturity?
 You’ll receive your original deposit + all earned interest. Many providers will move funds to an easy-access account unless you reinvest or give other instructions.

Q4: Are there tax-free options?
 Yes – some providers offer Fixed-Rate Cash ISAs, letting you earn interest tax-free.

Q5: What if inflation rises?
 If inflation outpaces your interest rate, your real return could diminish. Consider this when locking in rates.

Final Thoughts – Is a 3-Year Bond Right for You?

Choose a 3-year fixed rate bond if:

  • You won’t need the money for the next three years

  • You want guaranteed returns

  • You prefer low-risk options over investing in volatile markets

It’s a smart choice for medium-term savers who want peace of mind and solid growth.

Start Comparing with Fixed Rate Bond

Ready to lock in your rate? At Fixed Rate Bond, we help you:

  • Compare the latest top deals

  • Filter by deposit amount and rate

  • Access only FSCS-protected banks

  • Make smarter, safer savings decisions

Visit FixedRateBond.co.uk to find your perfect 3-year bond today!

Disclaimer: This guide is for informational purposes only and does not constitute financial advice. Always confirm current rates and terms with the provider before investing. FSCS protection applies only to eligible savings with UK-regulated institutions.

Location: United Kingdom

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