Monmouthshire leads way in top cash Isa rate stakes
Monmouthshire Building Society has raised the rate on its easy-access Cash Isa 6 to a top 1.65%.
You can put up to £15,000 into the account, but you can't transfer your existing cash Isas into this account unless you have other cash Isas with the society. And the account is only available to those living in its operating area.
Other top deals include BM Savings at 1.55% including a bonus for the first year, which accepts transfers, and National Savings & Investments at 1.5%, which does not.
On fixed-rate deals Yorkshire Building Society and its offshoots Barnsley, Chelsea, and Norwich & Peterborough building societies have launched a three-year deal at a top 2.5%.
The best one-year rate is 1.65% from both Tesco Bank and Aldermore Bank, while Barclays, Newcastle Building Society, AA Savings (part of Halifax) and Aldermore Bank all pay 2% fixed for two years.
Looking at taxable accounts, AA Savings easy-access Internet Extra account pays 1.4% before tax (1.12% after) to new savers. The rate is boosted by a 0.9 (0.72) percentage point bonus for a year.
Sainsbury's Bank eSaver Special pays a slightly lower 1.35% (1.08%), but the rate does not include a bonus that runs out after a year.
Newcastle Building Society has launched a two-year fixed rate bond at a top 2.35% (1.88%) fixed until October 2016, while Yorkshire Building Society's new deal pays a best rate of 2.5% (2%) for three years.
Among the top one-year rates are 1.95% (1.56%) from Investec Bank and 1.85% (1.48%) from Kent Reliance.
This article was written for our sister website Money Observer
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.