Alliance & Leicester / NS&I for better Cash Mini ISA Rate...??

Zero

Can anyone tell me which of these is giving the better rate? I'm not sure if I should be comparing the A&L rate of 5.20%, to the NS&I rate of 4.20% or to the NS&I rate of 5.25%. Thanks!

ALLIANCE & LEICESTER
Earn 5.20% gross p.a./AER (variable) includes bonus of 0.70% until 30.04.07 includes bonus 0.90% until 31 March 2007

http://www.alliance-leicester.co.uk/savings/index.asp?page=direct-isa


NATIONAL SAVINGS & INVESTMENTS
Tax-free rate pa/AER Equivalent gross rates*
4.20% 5.25% basic rate, 7.00% higher rate

http://www.nsandi.com/products/isa/rates.jsp

jimclark1967

The A&L rate is 5.2%

The NS&I rate is 4.2%

The reason they quote the other figures is to show what rate you would need from a savings account if you were paying tax on the interest.

e.g. 5.25% less 20% basic rate savings tax = 4.2%
and 7.00% less 40% higher rate = 4.2%

As a general rule NS&I have never had a market leading interest rate and aren't likely to.

JC

Zero

Thanks very much for the info...much appreciated...!!

Zero

So would I be right in thinking that with the Alliance & Leicester Mini Cash ISA you get instant access, so any or all money in it can be withdrawn at any time, and there are no transfer fees if transferring the Mini Cash ISA to another provider?

Though I don't think there are any better Mini Cash ISAs available with other providers, the A&L one seems to give the best rate.