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Several fixed rate cash ISA providers have increased rates recently, resulting in some welcome movement in the Best Buys. The two-year ISA chart may be particularly worth your attention, as rates have improved and these deals can provide the perfect compromise for those who don't want to put away their £20,000 annual tax-free allowance for too long.
With your annual allowance, you can open one new cash ISA or add funds to an existing product, but you can't pay into more than one cash ISA in any tax year (though some providers allow you to split your allowance between several cash ISAs in their range, which would be classed as a single ISA for tax purposes). Alternatively, you can transfer funds from previous years to a new account without affecting your allowance, as long as your provider allows this and you follow their instructions.
So, if you have an ISA pot that has come to the end of its term, or you're looking to put away new money, why not consider a two-year fixed ISA? Fixed rate versions tend to offer better rates than their easy access counterparts, while a two-year term allows you to access your savings again in the not-so-distant future.
Keep in mind that fixed rate accounts will often come with penalties if you want to withdraw the cash before the term ends – if early access is even allowed at all. Similarly, few accounts will let you make further additions, so you need to be confident that you can keep your money tied up.
That said, if you're happy to lock your money away for a mere 24 months for the promise of better returns, these accounts could be more than worth it. So, here are the top six two-year fixed cash ISAs currently on the market.
Taking the top spot is Al Rayan, with a deal that pays a market-leading expected profit rate of 1.81% AER (1.80% gross) quarterly on a minimum investment of £1,000. Savers have the whole plethora of account management options at their disposal, as well as the flexibility to add funds for a while, and can even transfer out of the account, although they would be charged a penalty for doing so.
In second place sits this deal from State Bank of India, which pays 1.75% yearly on a minimum investment of £5,000. Unusually for this sector, early access is possible, as long as you give notice and are happy for the account to then be closed. Note that this ISA will require you to open another account with the provider first.
Shawbrook Bank completes the top three, with an account that pays 1.70% if you have at least £5,000 to invest. It helpfully allows additions without limit, as well as early access on a penalty, making it an appealing ISA for those looking to keep their options somewhat open.
Next up is Charter Savings Bank, whose ISA pays 1.69% from an initial investment of £1,000. Further additions are allowed for some time and it comes with the option to access funds early should the need arise (subject to a penalty), which could make it an appealing choice.
In fifth place is this account from Ford Money, offering a rate of 1.65% on a minimum investment of just £500. Further additions are allowed for a little while, as is early access on an interest penalty.
Completing the top six is Aldermore, with an online account that also pays 1.65%, but on a minimum investment of £1,000. Savers have the option of withdrawing their funds before the two years are up, as long as they don't mind losing some interest, while additions are allowed for two weeks and transfers in are welcome from a wide variety of ISAs.
Information and rates correct as at: 05.07.2018
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.
