Gloomy start to ISA season - ISAs - News - Moneyfacts

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Gloomy start to ISA season

Gloomy start to ISA season

Category: ISAs

Updated: 07/02/2013
First Published: 07/02/2013

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
Untitled DocumentAs the ISA season fast approaches, Moneyfacts research reveals that both average rates and product choice are falling.

The average ISA today pays just 1.74%, compared to 2.55% this time last year.

Savers also have less choice when it comes to finding a competitive home for their tax-free savings. Moneyfacts data shows that currently there are only 309 ISA accounts to choose from, compared to 385 in February 2012.

Sylvia Waycot, Editor of Moneyfacts.co.uk, said: "New ISA accounts normally hit the market with a flurry of razzmatazz in early January but we are already in February and only a few accounts have trickled quietly into the market.

"Savers are desperate for some good news and the ISA season has always been a pretty reliable time for finding 'that account you're really pleased about'. But it may be a lot harder to find this year."

When it comes to finding the best cash ISA rate, savers have a number of options to choose from depending on their requirements.

Here are the top 4 cash ISAs:

Coventry Building Society
Coventry Building Society
60 Day Notice ISA

2.80% AER/Gross
  • Minimum investment £1
  • Rate includes introductory bonus of 0.60% for 12 months
  • 60 days' notice required to access funds
  • Transfers in not accepted
  • Apply online, in branch, by post or telephone

Penny says: "Coventry BS tops the cash ISA Best Buys with its 60 Day Notice ISA paying 2.80% on balances of £1 and over.

"Savers must remember that this rate includes a bonus for 12 months, so a review of the account at that time is a must. A disadvantage of this account is that previous cash ISA balances cannot be transferred in."

Earl Shilton Building Society
Earl Shilton Building Society
90 Day Cash ISA

2.70% AER/Gross
  • Minimum investment £10
  • 90 days' notice required to access funds
  • Transfers in not accepted
  • Apply in branch or by post

Penny says: "Earl Shilton BS's 90 Day Cash ISA pays the second top rate at 2.70% on balances of £10 and over.

"This cash ISA does not include an introductory bonus, so savers won't have to worry too much about the competitiveness of this account in a year's time. If early access is required, savers will lose 90 days' interest."

Chorley & District Building Society
Chorley & District Building Society
60 Day Notice Cash ISA

2.50% AER/Gross
  • Minimum investment £1
  • 60 days' notice required to access funds
  • Transfers in not accepted
  • Apply in branch or by post

Penny says: "Chorley & District BS's 60 Day Notice Cash ISA pays a competitive 2.50% on balances of £1 or more.

"As its name suggests, 60 days' notice is required to access funds once deposited, or else savers will incur a penalty of 60 days' interest."

Cheshire Building Society
Cheshire Building Society
ISA Saver (Issue 1)

2.50% AER/Gross
  • Minimum investment £1,000
  • Rate includes 2.00% bonus until 31.07.2014
  • Transfers in allowed
  • Apply online or by telephone

Penny says: "Paying 2.50%, Cheshire BS's ISA Saver (Issue 1) is the only cash ISA in the top 4 that allows savers to transfer in previous ISA balances.

"Savers must have at least £1,000 to deposit in order to qualify for this rate, and they must also make a note that after 31 July 2014, the rate will revert to 0.50%."

What Next?

Compare Best Cash ISA Rates

Compare Best Fixed Rate ISAs

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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