Savings update: The five top paying easy-access savings accounts
Rates for savers continue to fall on both easy-access and fixed rate accounts.
The top easy-access account comes from French-owned RCI Bank at 1.2% before tax (0.96% after tax).
In the high street, the best you can do is 1% (0.8%) with Virgin Money Manchester United Red Devils account. It is also available online along with Shawbrook Bank Easy Access, Skipton E-Saver and Aldermore Easy Access which all pay 1 per cent (0.8%).
On fixed rate bonds the best deals include 1.38% (1.1%) for one year or 1.46% (1.1%) for 18 months from Charter Savings Bank.
On tax-free cash Isas Coventry BS pays 1.1% and Family Building Society 1.09% on their easy-access accounts
The best fixed rates include 1.1% for one year from Aldermore Bank, Shawbrook Bank and Kent Reliance. For two years Newcastle Building Society along with Aldermore and Shawbrook pay 1.2%.
This story 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.