Rate Change Impact Calculator
See how a Bank of England base rate move affects your mortgage AND your savings, side by side.
Your Mortgage (variable/tracker)
Current Monthly Payment
£1,320
New Monthly Payment
£1,348
Monthly Change
+£28
Your Savings (variable rate)
Current Annual Interest
£675
New Annual Interest
£713
Annual Change
+£38
Net yearly impact: £-296, extra savings interest is outweighed by the extra yearly mortgage cost from this rate change.
How this was calculated
Mortgage payments use a standard amortising repayment formula on your outstanding balance. Savings interest is a simple annual estimate at your entered AER. This assumes your mortgage and savings rate move exactly in line with the modelled rate change, which may not reflect your specific lender or provider. Fixed-rate products are unaffected until they mature or your deal ends. Last verified: 2026.
How the Bank of England Base Rate Affects You
The Bank of England sets the base rate, which influences borrowing and saving rates across the UK economy, but the effect isn't the same for everyone. Whether a rate change helps or hurts you depends on your mix of borrowing and savings, and specifically whether your products are fixed or variable.
Who a Rate Rise Helps vs Hurts
A Rate Rise Hurts If You Have...
A variable or tracker mortgage, a large outstanding balance, or an SVR mortgage, your monthly payments increase almost immediately.
A Rate Rise Helps If You Have...
Significant cash savings in a variable-rate easy-access account, your interest income increases, though usually with a short delay.
Fixed-Rate Products Are Unaffected, Until They Aren't
If you're on a fixed-rate mortgage or a fixed-rate savings bond, a base rate change has no immediate effect. But it matters for what happens next: when your fix ends, you'll be remortgaging or reinvesting at whatever rates exist then, which could be higher or lower than your current deal. It's worth using this calculator to model what a rate change would mean if it happened to coincide with your renewal date.
Worked Example: A 0.5% Rise
Take a £200,000 repayment mortgage with 25 years left, on a tracker rate of 4.0%. The monthly payment is about £1,056. If the rate rises to 4.5%, the payment becomes about £1,112. That is £56 more a month, or roughly £672 more over a year.
Now add £20,000 in an easy-access account. If the bank passes on the full 0.5%, you earn about £100 more interest a year before tax. The mortgage costs you £672 more and the savings earn £100 more, so the household is about £570 a year worse off. Savings only offset a rate rise when the cash balance is close to the size of the mortgage.
Frequently Asked Questions
How quickly do mortgage payments change after a rate rise?
On a tracker or standard variable rate, usually within one or two billing cycles. Your lender must tell you in writing before your payment changes.
Do savings rates always rise by the full amount?
No. Banks often pass on only part of a rise, and sometimes after a delay. They tend to pass on cuts faster than rises, so check your account rate regularly.
I am on a fixed rate. Should I still use this?
Yes. Enter the rate you expect to remortgage at to see what your payment could be when your fix ends. It helps you decide how much to set aside before then.
Where can I find the current Bank Rate?
The Bank of England publishes the Bank Rate and the dates of its Monetary Policy Committee decisions on its website.
⚠️ Important Disclaimer
This calculator models a simplified scenario where your mortgage and savings rate move exactly in line with a hypothetical Bank Rate change. Real-world lenders and providers don't always pass on changes in full or immediately. This is not financial advice.
Frequently Asked Questions
How does a Bank of England rate change affect my mortgage?
If you're on a variable or tracker mortgage, your rate typically moves in line with the Bank of England base rate, changing your monthly payment almost immediately. Fixed-rate mortgages are unaffected until your deal ends.
How does a rate change affect my savings?
Variable-rate savings accounts (easy access, some ISAs) usually adjust within weeks of a Bank of England rate change. Fixed-rate savings and bonds are unaffected until they mature.
Will rates go up or down?
This tool lets you model any scenario, use the slider to see the impact of a rate rise or cut on both your mortgage and your savings at the same time.
Key Terms Explained
Plain-English definitions of the financial terms used in this calculator.
- Interest Rate
- The percentage charged for borrowing or paid on savings, usually per year. The Bank of England base rate influences most UK mortgage, loan and savings rates.
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Not Financial Advice: This calculator is for informational and educational purposes only. Results are estimates and do not constitute financial advice, recommendations, or regulated advice. We are not authorised or regulated by the Financial Conduct Authority (FCA). Always consult a qualified financial adviser for personalised advice. Tax treatment depends on your individual circumstances and may change. Tax laws and rates may change. Past performance does not guarantee future results.
