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With so much chaos in the economic landscape, the pound yo-yoing, and the cost of living at its highest point for years, if you’ve managed to squirrel away some savings, it makes sense that you’d want to ensure that you’re getting the most out of your account.

Although the rising interest rates are unwelcome for many, for savers, after historically low-interest rates, it’s not all bad news; but savers need to watch out for the best deals.

In this article, we’ll walk you through the following:

• What saving is looking like during the cost of living crisis
• The saving rates rise
• Some of the best deals out there right now

Saving during the cost of living crisis

During the cost of living crisis a significant number of people have stopped paying into a savings account. According to a recent survey conducted by the Building Societies Association (BSA), 35% of those polled have stopped saving due to the rising cost of living, with 36% now relying on their savings to pay for day-to-day costs. Moreover, before the crisis, around one in 10 UK residents had no savings at all. However, millions of pounds are still in savings accounts and if you’re keeping your head above water and managing to save, you’ll likely be looking for the right account for you to secure the best deals.

Saving accounts come in a few different forms and typically are not subject to tax until you reach a certain threshold, this is called the personal savings allowance (PSA) and is dependent on what rate of income tax you pay. Basic rate taxpayers can earn £1,000 in interest each year without having to pay tax on that interest, for higher rate taxpayers this drops to £500. A basic rate tax payer who earned £1,200 in interest in would therefore only pay tax on the £200 above their PSA, which at 20% would be just £40 of tax on £1,200 of interest.

ISAs are comparable to a regular savings account, but whatever interest you earn remains entirely tax-free. However, ISAs tend to pay a lower rate of interest. For those looking for flexibility, an easy-access savings account can be a good option, as it allows you to dip into your savings at short notice without receiving penalties; likewise, the amount of money required to open an easy savings account is usually lower than other savings accounts. Fixed-rate savings accounts or bonds, on the other hand, while less flexible, offer you a guaranteed interest rate over a set period of time and typically offer higher interest rates.

A current account can be used as a savings account, although some basic accounts don’t offer interest on your balance. When looking into using a current account as a savings account, consider the interest rates and account requirements, as some will require you to pay a certain amount of money each month. Some current accounts can see interest rates exceed 5%, but this is often subject to a maximum sum you can save before it drops again.

Saving rates reach highest levels in over a decade

Savings rates in recent months have reached their highest levels in more than a decade. However, as Anna Bowes of independent comparison service Savings Champion says, things are changing so quickly, and she warned a week ago that people were “in danger of missing the peak.” Equally, research from BSA shows that many people aren’t sure what they’re getting with a savings account in the first place, with 31% of those with savings accounts never even checking their savings account interest rate.

Recent research on savings rates found that the average easy-access rates have risen from 0.25 to 1.05%, while since March, the average one-year deal has risen from 0.92 to 3.1%. However, banks and building societies have recently been pulling their savings accounts, Santander being one of them, withdrawing its best buy easy-access saving account two weeks ahead of schedule, and replacing it with a new issue paying a lower rate of 2%.

That said, a spokesperson for the Savings Guru, said that this withdrawal was not surprising and the likes of Skipton moving up to 2.55% is good news, and indicates that the market will consolidate around 2.25 to 2.5% on easy access. Likewise, the spokesperson said that the fixed rate changes that have been seen this week are unlikely to lead to a “full-blown market correction.”

The best saving rates right now

There is a wide range of saving rate deals currently available, and some are even breaking the 5% barrier. Below, we walk through a few of them.

The Barclays Rainy Day Saver account at the time of writing, was offering 5.12% interest on balances up to £5,000, after which this decreases to 0.15%. In a year, those with £5,000 saved will earn £250. There is, however, a £5 monthly membership fee, and you have to pay at least £800 each month. It also has some good rewards for those who are already Barclays customers. The Nationwide FlexDirect Current account is offering just below this at 5% on the first £1,500 saved, with no fees.

The Aldermore 1 Year Fixed Rate Cash ISA has also been highlighted as a good go-to, with 3.65% interest and a minimum deposit of £1000, with withdrawals subject to a deduction of 90 days’ interest.

With regard to fixed rates, those who choose this kind of savings account will be unable to access their money, typically for a period of at least three years, unless they pay a penalty fee. So, this won’t be a viable option for everyone. Investec Bank plc Raisin UK – 2 Year Fixed Term Deposit is currently offering a 4.61% rate for savings between £1,000 and £85,000, but the highest rate on the market is offered by Gatehouse bank, which has a five-year deal that pays 5.1%.

For more information on the best saving rates, check out MoneyFacts or MoneySupermarket.