Savings update: snap up top deals before Brexit hits rates
Savers keen to snap up the top fixed rate on their money will need to act fast as the best deals are likely to be withdrawn imminently.
Already Close Brothers has closed its top-paying bonds following the UK's decision to leave the EU - which brings with it fear that interest rates could fall.
Top paying one-year bond comes from online provider Charter Savings Bank at 1.79% before tax (1.43% after tax) or, on the high street, 1.5% (1.2%) from Co-op Bank's Britannia Bond.
For two years Charter Savings Bank pays 1.91% (1.53%) while the rate at Co-op Bank is 1.6% (1.28%).
The top easy-access rate is 1.45% (1.16%) from French-owned RCI Bank's Freedom account. Your money is covered by the pan-European Union deposit protected scheme rather than your home-grown Financial Services Compensation Scheme.
Other top rates
Virgin Money Defined Access Saver pays 1.26% (1.01%) but you are limited to making three withdrawals a year on this account.
If you make more your rate tumbles to 0.5% (0.4%). Internet-based bank Shawbrook pays 1.25% (1%).
On tax-free cash Isas, the best easy-access rate comes from Coventry BS at 1.3% but you can't transfer your existing cash Isas into this account.
For two years you can earn 1.4% with Leeds Building Society, Virgin Money or Shawbrook Bank.
This article was originally written for our sister magazine, 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.