Top savings rates continue to change
Banks and building societies continue to chop and change rates for savers.
The top easy-access cash Isa deal is 1.55% tax-free from BM Savings and Post Office. But both include a bonus for new savers, so you need to move your money when these run out.
The BM Savings rate tumbles to 0.5% after a year. The Post Office bonus lasts for 18 months before dropping to 0.75%. But there are withdrawals restrictions on this account - you can only make two withdrawals a year.
The top easy-access deal where the rate is not boosted by a bonus is 1.5% from National Savings & Investments. But you cannot transfer your existing cash Isas into this account.
Best deals for transfers with no bonus include Barclays Instant Isa at 1.49% on a minimum £30,000, and Sainsbury's Bank and Teachers Building Society, both paying 1.45%. If you are prepared to tie your money up for a year, Post Office pays 1.7% and Tesco Bank 1.65%.
For two years Virgin Money pays 2.1% fixed until November 15 2016.
On taxable accounts the top rate on easy access accounts is 1.4% (1.12% after tax) from AA Savings, Post Office and Tesco Bank. All three come with a bonus which lasts for a year before the rate drops.
The best deal with no bonus is 1.3% (1.04%) from Virgin Money. Kent Reliance pays a higher 1.5% (1.2%), but it is only available through its limited branch network.
On fixed rate deals you can earn a top 1.85% (1.48%) with BM Savings for one year, or 2.36% (1.89%) from Secure Trust for two years.
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.