The Post Office has unleashed some new fixed rate cash ISAs on the market, one of which now sits behind the market-leader for its terms. Meanwhile, an existing variable ISA has had its rates increased, securing its place in the top 10.
The new Fixed Rate Cash ISA Issue 13 has a one, two or three-year term. The one-year ISA pays 1.70% on the account's anniversary, which places it just behind the market-leader, while the two-year version pays an annual rate of 1.95%, earning it a place in the top 10. The three-year variant pays a yearly rate of 2.10%.
Meanwhile, Premier Cash ISA Issue 7, a variable rate account, now has a top 10 rate of 1.55% per annum. However, this includes an 18-month bonus of 0.80%, so a review of the account's competitiveness will be necessary when this expires.
The new cash ISAs require a minimum investment of £500 and they can be opened in branch or by post, and then managed over the phone or by post.
An early access facility is offered, but this will result in closure of the account and an interest penalty. The one-year ISA will lose 90 days' interest, while the two and three-year ISAs will be penalised 180 days' interest. Transfers out will incur the same penalty.
Transfers in are not permitted and further additions are also not welcomed, so investors must think carefully about the amount they want to invest.
The variable rate ISA needs a smaller minimum investment of £100 and can be opened and managed in the same way as the fixed rate ISAs. Transfers in of other ISAs are welcome and two withdrawals may be made each year, after which the account will be closed or transferred.
The one and two-year fixed ISAs, along with the variable rate offering, all sit on the best buy charts. However, the one-year cash ISA offers the most competitive deal as it sits just behind the market-leader in its sector. It is bound to attract investors hungry for profit, and it also benefits from the option of early access, although this is subject to a penalty and closure of the account.
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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 Any products featured may be withdrawn by their provider or changed at any time.
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