Cash ISAs: The Best Currently Available List

KTF

Should the Newcastle 1 year Reward ISA be included Under the section: Variable rate Cash ISAs requiring notice to be given & accepting transfers in?

http://www.newcastle.co.uk/savings/rewardisa

samizdat

Normally, I strongly prefer to have instant access to money because the opportunity cost of not having it can be quite high.

However, I am always keen to look at the withdrawal terms on fixed rate products, which can sometimes be quite reasonable or even amazingly reasonable, as was Newcastle BS's extraordinary 5-year Fix last year, which was actually a 90-day notice account paying 5%, and ISA-able.

Anyway, this year, variable rates are even lower than they were last year, presumably because funding terms have eased more generally for deposit-taking institutions. For new money, it seems hard to look past the Santander Group offerings at 3.5%, guaranteed to be 3 points over Bank Rate for 12 months. Why fix at 3% for one year when you have this alternative. The answer, of course, is a) what about prior years' money? and b) the Santander Group have appalling customer service.

I thought I should have a quick look at the terms on Clydesdale's 5% 5-year fix and Nationwide's 4.4% 3-year fix. Both accept transfers in. Clydesdale has a fairly attractive withdrawal penalty that is effectively fixed at 180 days' interest (it does get even lower right at the end of the term). Nationwide, on the other hand, has a fixed penalty of 270 days' interest. In both cases, the charge will be taken from capital if insufficient interest has accrued.

Using this information, one can construct a total return index for each product at different maturities. It goes like this. (link to a picture) EDIT: I have now changed the link to include the M&S 3-year fix.

You can see from this that the Clydesdale ISA is actually a reasonable product at all maturities from 12 months onwards, e.g. returning over 2.5% even after just one year, and beating all the available 2-year fixes and all the 3-year fixes except Nationwide. It also beats all the 4-year fixes and is, of course, the best 5-year fix. Not bad for a product that supposedly locks you in for 5 years.

I assume that the Yorkshire product is the same as Clydesdale and Yorkshire are both owned by National Australia Bank but I haven't checked. [Edit: I have now checked and, yes, they are the same.]

Hope this helps some people. Please post here if the link is bogged down/not working.

Lombardi

I am looking for a one/two year fxd ISA to transfer in £30K. I looked at HSBC's one year Fxd 2.85% and Saga 3.6% two year fxd. I do not think it is wise to fix for a longer period. Is it likely that better rates will appear shortly? What do the experts on the site suggest?

samizdat

Lombardi wrote: »

I am looking for a one/two year fxd ISA to transfer in £30K. I looked at HSBC's one year Fxd 2.85% and Saga 3.6% two year fxd. I do not think it is wise to fix for a longer period. Is it likely that better rates will appear shortly? What do the experts on the site suggest?

Sorry, maybe I should have made myself clearer.

******
ANYONE TAKING OUT A FIXED RATE ISA, YOU SHOULD READ MY POST ABOVE AND LOOK AT THE LINKED PICTURE.
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yOU WILL mkae money, init?

Baldur

@ Lombardi

The best rates are normally available around now, in order to 'mop up' any funds that have not yet been allocated to the current tax year's Cash ISA plus the early funds for the coming tax year's ISA.

The current situation is not 'normal' though, so your guess is as good as anyone else's.

The way that rates on many accounts have been and are being cut recently, I personally wouldn't bank on significantly better rates showing up in the short term.

Lombardi

Many thanks Samizdat..your post is very clear, it was posted at the same time as a wrote my question. I shall certainly look at the Clydesdale 5 year fix. My thanks also to Baldur

samizdat

Lombardi wrote: »

Many thanks Samizdat..your post is very clear, it was posted at the same time as a wrote my question. I shall certainly look at the Clydesdale 5 year fix. My thanks also to Baldur

TeeHee. Yes, sorry, I thought it might have been but I couldn't resist publicising my post a bit more and thought maybe I hadn't spelt things out enough. Thanks for not taking offence.

Kazza242

tiptoe_mouse wrote: »

Thanks Kazza for all the work you put in keeping this list up to date.

I've noticed that you have to have a Nationwide card account to open their ISA - might it be worth mentioning this in the first post?

Thanks,

tiptoe

Thanks, will add this information.

diamond_dave wrote: »

Just checked the Mansfield B.S site & it states that it does not acccept transfer in.Can anyone confirm this?

Hi, thanks for raising this. When this ISA was first launched I used the info from Moneyfacts, as the ISA hadn't yet been added to the Mansfield Building Society website. Moneyfacts' info said that it did accept transfers in! I have moved it to the 'new money' fixed rate ISAs section.

The_Enforcer

samizdat wrote: »

Please post here if the link is bogged down/not working.

It's not working.

samizdat

The_Enforcer wrote: »

It's not working.

OK, try this .

Original seems to be working right now also.