First Direct cash ISA interest dropping sharply

Crixus00

If you want to keep your savings in one bank for convenience then I would suggest looking on the first direct website and/or calling them to see what you could do savings wise rather than being what seems to be flavour of the month for some people being rude to suggestions people make.

What is it with keyboard warriors at the moment? If you want advicethen show a little respect to people who post on this forum

blueberrypie

katejo wrote: »

I have had the above account for many years. I currently get between 2.5 and 3% interest. I have just been told that the interest rate from april will vary according to balance. To continue getting this rate, I will have to have 40K in the account! With my current balance I would only get 0.5%
I will be looking for a new ISA after April 6th.

It is standard for ISA interest rates to drop after a certain length of time - often a year on a variable-rate product, and after the date of maturity on any fixed-rate product.

This is not sharp practice on FD's part, it's how all ISA providers work. If you do look at the ISAs board, you'll see that there are plenty of people who didn't pay attention to what interest rate they were getting, and then suddenly discovered they were earning 0.5% or less, rather than the rate they initially received. However if they had read the basic information about ISAs on this site, they wouldn't have been surprised by this. See http://www.moneysavingexpert.com/savings/cash-isa-transfers#why for example.

As ISAs are not intended as "instant access" savings, but rather as longer-term products, there's not much inconvenience involved in having your ISAs and current accounts with different providers. It is entirely up to you if you choose to deal with only one bank, but it will inevitably cost you more than choosing the best deal for you from all providers (whether you're looking for an ISA, an ordinary savings account, a loan or a mortgage).

newbutold

Scrounger wrote: »

You should also consider the first direct regular saver account.

At 8% gross (6.4% net) it beats any current cash ISA. :beer:
Scrounger

I bank with first direct as I think the service is second to none. However other than using the regular saver above, all my savings are elsewhere, they are pretty poor on the savings side of things.