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National Savings and Investments (NS&I) has raised the rates on its fixed savings accounts, with its best rate now sitting at 4.75 per cent on its five-year fix.

The boosted rates are available on its one, two, three and five-year Guaranteed Growth Bonds and Guaranteed Income Bonds. 

Savers can opt for either monthly interest, or interest at the end of the fix.

The Government-backed savings provider has increased rates during a particularly strong period for fixed savings deals, with options elsewhere reaching 5 per cent.

This rate is offered by Investec on its three-year fixed savings account, while Atom Bank is also offering 5 per cent on a five-year fix.

But Caitlyn Eastell, a personal finance analyst at rates scrutineer Moneyfacts, believes some may be willing to sacrifice the extra interest for the peace of mind NS&I offers. 

'Unlike traditional savings accounts, every pound held with NS&I is backed by HM Treasury, giving savers an unlimited Government guarantee rather than the £120,000 FSCS protection available with banks and building societies,' she said.

Keep in mind that the interest you earn above your personal savings allowance in these accounts is taxable – they aren't tax-free Isas.

You need at least £500 to get started with the NS&I bonds and the maximum balance you can have is £1million. You'll have zero access to your money for the duration of the fixed term.

NS&I has raised rates by a small amount across several fixed-term savings accounts. 

The biggest boost is available on its five-year accounts, with a 0.2 per cent hike on the growth bond, which pays interest at the end of the term. Income bonds pay interest monthly.

Here's how the rates now look:

You can use This is Money's rate calculator to work out your earnings after tax for both basic-rate and higher-rate taxpayers, if you've already used up your personal savings allowance.

For the one-year growth bond, for example, your actual earnings would look like this:

• Gross interest rate: 4.72 per cent
• Basic-rate taxpayers will receive: 3.78 per cent
• Higher-rate taxpayers will receive: 2.83 per cent

There are two separate rates on the income bonds, because the AER – or annual equivalent rate – includes compound interest. 

However, taking a monthly income out of the bond rather than keeping it in the account means you aren't earning interest on your interest, so the gross return is slightly lower. 

The new rates push the NS&I accounts up our independent savings tables, but you can still find better returns.

GB Bank is offering 4.92 per cent on a one-year fix, but you need to deposit at least £1,000 to open the account. For an alternative one-year fix, look at Oaknorth, which only asks for a minimum of £1 and is offering 4.86 per cent.

For longer fixes, both Atom Bank and Investec lead the way, offering 5 per cent on their five-year and three-year accounts respectively. It's the first time since 2024 that fixed savings accounts have reached 5 per cent.

It's worth considering investing if you're willing to lock your money away for at least five years. 

There's more risk involved, because investments rise and fall in value, but over the long term it's possible to achieve greater returns by investing rather than saving in cash.

If you still have your £20,000 tax-free Isa allowance to use, cash rates are also strong. 

RCI Bank is offering a two-year fix at 4.80 per cent and Tandem Bank is offering a five-year fix at 4.81 per cent.

For the top easy-access Isa rate, investment platform Trading 212* is offering 4.51 per cent, which includes a fixed 0.91 per cent boost for 12 months.