Cash ISA's variable and fixed

lollylou1

Hi there, if a rate is fixed at 1.3% for 12months and the variable amount is currently 1.5%, does this mean the rate paid will be at 1.5% and just wont go lower than 1.3% during that 12month period?

badger09

lollylou1 wrote: »

Hi there, if a rate is fixed at 1.3% for 12months and the variable amount is currently 1.5%, does this mean the rate paid will be at 1.5% and just wont go lower than 1.3% during that 12month period?

Variable rate and fixed rate ISAs are 2 different products.

A variable rate ISA currently paying 1.5% could reduce (or very unlikely) increase that rate at any time, depending on the specific terms & conditions

A fixed rate ISA paying 1.3% will pay that rate for however long the fix is for.

Do you have a specific product in mind?

lollylou1

Hi there, thanks for responding. It is a cash ISA with a variable rate currently at 1.5, sorry I should have mentioned previously it has a fixed bonus of 1.3% for 12 months

badger09

That makes more sense

In that case, you're guaranteed to get at least 1.3% for 12 months.

Obviously, we don't know your circumstances, but have you looked at current accounts (Nationwide Flexdirect, Santander 123, etc) which are paying much higher interest than this 1.3% or 1.5%?

lollylou1

No I hadn't considered those current account as I was under the impression the rates would be lower than an ISA, but thanks for your help, I will go and check them out.