Cash ISAs: The Best Currently Available List

Middle_Sister

What happens if you open a Plum cash ISA paying 5.92% which consists of 3.54% basic rate + 2.38% bonus rate for 3 months. Does the rate drop to the 3.54%?  Is that better than opening a 1 yr fix at say 4.5%?

Middle_of_the_Road

Middle_Sister said:

What happens if you open a Plum cash ISA paying 5.92% which consists of 3.54% basic rate + 2.38% bonus rate for 3 months. Does the rate drop to the 3.54%?  Is that better than opening a 1 yr fix at say 4.5%?

Depends if you want a variable or fixed account.
With the Plum bonus rate reducing after three months, and no other rate changes it would return less than the fix at 4.5%

slinger2

The "2.38% bonus rate for 3 months" will give you 2.38%/4=0.6%. Adding that to your 3.54% will give you 4.14% over the year. So leaving it with Plum for the whole year is probably not the best idea, unless they come up with another bonus. And it's a variable rate product so it might well be less than advertised.

Of course you could transfer it out of Plum after 3 months and hope to get a better rate or another bonus.

pecunianonolet

Middle_Sister said:

What happens if you open a Plum cash ISA paying 5.92% which consists of 3.54% basic rate + 2.38% bonus rate for 3 months. Does the rate drop to the 3.54%?  Is that better than opening a 1 yr fix at say 4.5%?

Plum has so many traps of when they pay a bonus, when it drops, when you get this and that. Go back a few pages here read about it and read the Plum T&C's in very fine detail. Many here stay away from them as their product is just so complicated and has so many traps and "hidden" clauses. 

masonic

slinger2 said:

Of course you could transfer it out of Plum after 3 months and hope to get a better rate or another bonus.

Even in that case, some interest must be forfeit, so the outcome over 3 or 4 months is equivalent to a rate a little over 5%. That said, it is the best place to start on the merry go round as it doesn't pay the high rate on transfers.

slinger2

Fixed rate Cash ISA rates are on the slide a little. For a 1 year fix Zopa are now 4.30% instead of 4.40% and Vanquis are down to 4.20% from 4.42% (and 4.51% before that).

northernstar007

newcastle building society still offering 4,30 1 yr fixed till 26/6/26

2010

Coventry members 1yr fixed ISA 4.3%
It's actually fixed til 31/5/26

Middle_Sister

slinger2 said:

The "2.38% bonus rate for 3 months" will give you 2.38%/4=0.6%. Adding that to your 3.54% will give you 4.14% over the year. So leaving it with Plum for the whole year is probably not the best idea, unless they come up with another bonus. And it's a variable rate product so it might well be less than advertised.

Of course you could transfer it out of Plum after 3 months and hope to get a better rate or another bonus.

Thanks for that.  I didn't realise I could transfer out after the 3/4 months. I thought I had to keep it for the year. I think that's what I'll do. 

slinger2

Middle_Sister said:

slinger2 said:

The "2.38% bonus rate for 3 months" will give you 2.38%/4=0.6%. Adding that to your 3.54% will give you 4.14% over the year. So leaving it with Plum for the whole year is probably not the best idea, unless they come up with another bonus. And it's a variable rate product so it might well be less than advertised.

Of course you could transfer it out of Plum after 3 months and hope to get a better rate or another bonus.

Thanks for that.  I didn't realise I could transfer out after the 3/4 months. I thought I had to keep it for the year. I think that's what I'll do. 

There's a number of other threads about this account which you should read. My reading is that the bonus will be paid after 3 months. You'll lose some interest when you move money out. The whole thing's a can of worms. Personally I wouldn't touch it with a bargepole.