Long-suffering savers see another drop in rates

Published by Sylvia Morris on 02 December 2014.
Last updated on 02 December 2014

Savings tin

BM Savings has closed its Internet Extra Isa at 1.55%, replacing it with another version for new savers at 1.35%.

Hinckley & Rugby Building Society has cut by 0.15 percentage points the rates on 19 accounts for existing savers, including its Premier Saver which now pays 1.1% before tax (0.88% after tax). Metro Bank will cut rates for new savers from today.

The top easy-access cash Isa rate comes from Post Office Premier Cash Isa at a tax-free 1.55%, including a 0.8 percentage point bonus for the first 18 months. You can transfer your existing cash Isas into the account.

The best deal without a bonus comes from National Savings & Investments Direct Isa at 1.5% but this account does not accept transfers. Barclays pays 1.49% on a minimum £30,000 on its Instant Cash Isa issue 1, while at Sainsbury's Bank the rate is 1.45%. Both accept transfers.

Find the best Cash Isa or savings account for you

Fixed-rate Cash Isas

On fixed-rate cash Isas the best one year deal is 1.7% from Post Office or 1.65% from Virgin Money. Barclays and AA Savings, part of Halifax, both pay 2% for two years.

On taxable accounts the over 50s can earn 1.55% (1.24%) with Saga Internet Saver.

For others the best deal is 1.4% (1.12%) from AA Savings, Tesco Bank and Post Office. All four accounts include a bonus for the first year, after which the rate will drop as low as 0.4% (0.5%).

If you prefer an account without a bonus then State Bank of India and Kent Reliance pay 1.25% (1%).

On fixed-rate bonds First Save pays 1.85% (1.48%) for one year, while the top two-year rate is 2.25% (1.8%) from State Bank of India.

This article was written for our sister website Money Observer

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