Savings update: where to find the best Christmas rates
Savers can earn a top 1.65 per cent before tax (1.32 per cent after basic rate tax) with the relaunch of the ICICI Bank easy-access HiSave Supersaver account.
The French RCI Bank pays the same rate, while Shawbrook Bank's new Easy Access 2 pays 1.45 per cent (1.16 per cent).
None of the rates are boosted by an initial bonus and there are no restrictions as to the number of withdrawals you can make each month.
On fixed-rate deals the top one-year rate comes from internet bank FirstSave at 2.12 per cent (1.7 per cent).
Meanwhile, on the high street, the new bond from Yorkshire Building Society and its offshoots Chelsea, Barnsley and Norwich & Peterborough pays 1.85 per cent (1.48 per cent).
Cash Isa rates
On cash Isas, the top easy-access deal with no bonus and no withdrawal restrictions comes from Coventry Building Society at 1.5 per cent.
Post Office pays a marginally higher 1.51 per cent, but the rate includes a bonus for the first 12 months after which it drops to 0.65 per cent.
The best fixed-rate cash Isa deals for one year come from AA Savings, where the deposit taker is Bank of Ireland at 1.76 per cent, followed by Tesco Bank at 1.75 per cent.
For two years AA Savings pays 2.01 per cent while Shawbrook Bank and Principality Building Society both offer 2 per cent.
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.