Today's best savings rates
THIS IS AN OLD VERSION OF MONEYWISE'S DAILY SAVINGS ROUND-UP. FOR THE LATEST VERSION CLICK HERE
Good news for savers - the new tax year on 6 April saw ISA allowances increase to a total annual savings limit of £7,200, of which up to £3,600 can be kept in a cash ISA.
For the best new ISAs on the market, check out the Moneywise ISA round-up and find out which accounts accept transfers and which don't.
However, if rate is king for you, then Barclays Bank continues to offers an instant mini-cash ISA paying 6.5% AER on deposits from £1. Or Birmingham Midshires pays 6.35% AER on deposits of £1,000.
If you don't mind giving 30-days' notice, then you could consider Scarborough Building Society's 6.3% ISA for deposits from £1,000.
Or National Counties pays 6.26% AER on deposits of £1.
If you are concerned that the Bank of England may cut interest rates in April or in the months ahead, then you may want to consider a fixed rate ISA. Although these accounts protect the rate of interest on your savings, your money will be locked away for a set period of time - so don't go for this option if you need to make regular withdrawals.
Principality offers a six-month account paying an impressive 6.6% AER - transfers are permitted but the minimum deposit is £3,600.
Skipton also offers a fixed-rate account paying 6.26% AER until 5 April 2009. The minimum deposit is £50 but transfers are not allowed.
Or, if you are willing to put your money away for four-years, then Halifax pays 6.2% AER on deposits of £3,000.
|Source: Moneyfacts 03/04/08|
If you want a fixed rate ISA and have the full £3,000 to put aside then Halifax has a four-year fixed rate ISA paying 6.20% AER.
But if you’ve got less to save and want a fixed rate ISA, then Nationwide offers a one-year product paying 6.15% on deposits from just £1. It also offers a two-year account at the same rate.
Julian Hodge Bank offers a one-year account also paying 6.15% - but only if you are willing to invest the full £3,000.
Fixed rate accounts
If you've used your ISA allowance and want a regular saving account where the interest rate is protected from Bank of England base rate changes, then a fixed rate account might be for you. Icesave has a six-month account paying 6.76% AER or a one-year account paying 6.7%. But you will need a deposit of at least £1,000 to open either of these accounts.
An alternative is Birmingham Midshires' six-month account which will pay 6.76% on deposits of just £1.
Elsewhere, SAGA offers a one-year account with an AER of 6.41% for deposits as little as £1, and Cheshire Building Society pays 6.3% for one-year on deposits of £1,000.
|Short-term fixed accounts||AER||Notice/term||Deposit|
|Souce: Moneyfacts 03/04/08|
|Alliance & Leicester||6.3%||01/05/09||£1,000|
For a slightly longer fixed deal, Icesave offers a two-year account paying 6.6% on deposits of around £1,000. It also has a three-year account paying 6.5% again on deposits of £1,000.
FirstSave also offers two accounts both priced at 6.3% for either two-years or three-years, as long as you have £1,000 to put away.
Or, Shepshed Building Society has a two-year account paying 6.25% on deposits of £500.
Instant access accounts
If you want to manage your money online, then Kaupthing Edge offers a savings account paying 6.5% AER on deposits of £1,000.
If you have less to save then FirstSave has an Easy Access online account paying 6.26% on deposits of £100.
Or you could opt for ICICI Bank’s HISAVE Saving account which pays 6.17% on deposits from £1.
And Principality BS has an online offering paying 6% AER on deposits from £1
|Soure: Moneyfacts 03/04/08|
|ICICI Bank UK||6.17%||None||£1|
|Bradford & Bingley||6.15%||None||£1|
Heritable Bank has launched an account paying 6.06% AER on deposits of at least £1,000 although it only allows six withdrawals a year. If you have less to save then Anglo Irish Bank pays 6.05% on deposits from just £1.
Or if you are happy to manage an account through the post, then Bradford & Bingley pays 6% AER on deposits of at least £1,000.
Best of the rest
If you are committed to making regular savings then Abbey has a fixed account paying 7.23% AER for monthly deposits of between £20 - £250.
If you are over 50 then you could consider a product from Coventry Building Society. It has extended its 60-plus notice account to the over 50s. The account has an AER of 6.45%, which includes a 0.60% bonus for the first year from account opening.
Finally, if you’re a parent looking to set up a savings account for your children, then Halifax’s one-year Children’s Saver bond continues to outshine its competitors, paying 10% AER on deposits from £10.
If you have less to save then Yorkshire Building Society offers an instant access account paying 5.99% on deposits of £100.
To search and apply for other great saving rates click here.
There are limits to how much you can invest in any tax year. For 2011/12, the limit is £10,680. Of that, the maximum you can invest in cash is £5,340 and the balance of £5,340 can be invested in shares (individual company shares or investment funds). If you don’t take the cash ISA allowance, you can invest up to £10,680 into a stocks and shares ISA.
A savings account on which the account holder is required to give a period of notice before making a withdrawal or face a penalty, usually a loss of a specific number of days’ interest or pay a fee. Notice periods of 30, 60 or 90 days are common. These accounts usually pay higher than average interest rates and require large initial deposits (£1,000 minimum) so the notice period and penalties are there to discourage withdrawals. Some of these accounts will only allow a certain number of withdrawals a year.
Invidivual Savings Accounts were introduced on 6 April 1999 to replace personal equity plans (PEPs) and tax-exempt special savings accounts (TESSAs) with one plan that covered both stockmarket and savings products, the returns from which are tax-exempt. The ISA is not in itself an investment product. Rather, it’s a tax-free “wrapper” in which you place investments and savings up to a specified annual allowance where the returns (capital growth, dividends, interest) are tax-exempt (you don’t have to declare ISAs and their contents on your tax return). However, any dividends are taxed within the investment, and that can’t be reclaimed.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.
Also referred to as the bank rate or the minimum lending rate, the Bank of England base rate is the lowest rate the Bank uses to discount bills of exchange. This affects consumers as it is used by mainstream lenders and banks as the basis for calculating interest rates on mortgages, loans and savings.
Where APR is the rate charged for money borrowed, Annual equivalent rate is how interest is calculated on money saved. The AER takes into account the frequency the product pays interest and how that interest compounds. So, if two savings products pay the same rate of interest but one pays interest more frequently, that account compounds the interest more frequently and will have a higher AER.