Astonishing reduction to Leeds BS ISA

retiree

As the Limited Issue Online Access ISA (issue 11) matures into E-ISA (issue 6), the interest rate drops from 1.46% to just 0.15% if you take no action.

eskbanker

Astonishing in what way?  Pretty much every fixed term or fixed rate product is converted/switched/transferred into the inevitably inferior standard variable rate products by default on maturity - this will have been mentioned in the Ts & Cs of the original product, although the recent substantial decrease in variable rates across the board will have exacerbated the effect....

retiree

True, but if you were now to simply transfer the maturing account into its current equivalent (i.e. Limited Issue Online Access Cash ISA, issue 20), you can quintuple the new rate to 0.75%. I was trying to indicate the desirability of taking action, rather than just accepting the default arrangement.

eskbanker

retiree said:

True, but if you were now to simply transfer the maturing account into its current equivalent (i.e. Limited Issue Online Access Cash ISA, issue 20), you can quintuple the new rate to 0.75%. I was trying to indicate the desirability of taking action, rather than just accepting the default arrangement.

A good point, which would have been worth making in the original post!

epm-84

Given Nationwide have reduced the rate of their loyalty ISA from 1.4% to 0.25% (as the name suggests it's a product for loyal customers) and that doesn't relate to the loyalty ISA maturing and the funds being moved to a lower rate account, I don't think the Leeds BS situation is 'astonishing.'

You can get 1.3% on a 30 days notice ISA with Aldermore if you're not likely to need your money at short notice.

retiree

The Aldermore 30 days notice ISA  account is 1.05% on their website.

MDMD

epm-84 said:

Given Nationwide have reduced the rate of their loyalty ISA from 1.4% to 0.25% (as the name suggests it's a product for loyal customers) and that doesn't relate to the loyalty ISA maturing and the funds being moved to a lower rate account, I don't think the Leeds BS situation is 'astonishing.'

You can get 1.3% on a 30 days notice ISA with Aldermore if you're not likely to need your money at short notice.

The Aldermore ISA appears to be 1.05%

https://www.aldermore.co.uk/personal/personal-savings-accounts/cash-isas/notice-cash-isas/30-day-notice-cash-isa/

BigBlueSky

Family Building Society are offering 1.35% on 35 days notice ISA too.

epm-84

retiree said:

The Aldermore 30 days notice ISA  account is 1.05% on their website.

You could open an issue 7 ISA offering 1.3% until COP yesterday.  It looks like they've now withdrawn issue 7 and replaced it with issue 8 offering 1.05% instead.

margaretx9

BigBlueSky said:

Family Building Society are offering 1.35% on 35 days notice ISA too.

Only on balances above £30k - its only 1.15% on the minimum £3k balance.
And its variable - so could drop anytime.
Surely makes sense to go for a 1 or two year fixed rate ISA - as any variable rate isas could be slashed tomorrow.

lhsecons

According to their website, Family Building Society will only let you open an account if you have another one with them which has been open for 2 months.