Do you think Fixed Rate ISA rates will go much higher?

silvermum

Seeking the wisdom of crowds... crystal balls out please!

Do you think there are still rate rises to come through in the next few months, or have they likely peaked with the current BOE increase already anticipated?

Specifically the Virgin 1 year 5.05% FRISA, as this would be an easy switch for me (I know I could get better elsewhere, but I already have an account and don't want to add yet another provider to my list right now!)

Catplan

BOE base rate, as you say crystal ball, it might be clearer when inflation figures are announced later this month if another BOE base rate rise is likely or not.

The next part is will any rate rise be passed on / reflected in fixed isa rate.

If inflation is still high then I expect a BOE rate rise , no idea if virgin do anything though, or any other providers.

lohr500

Over the past year or so, with rising inflation numbers, it has been a tough one deciding whether to sit tight and hope for a better rate soon, or take what's on the table at the time.

Personally I think inflation rates will start to reduce sometime soon and lagging behind a reduction in interest rates. So I have just grabbed the Virgin 5.05% 1 year FRISA to transfer an old money variable rate ISA into.

Like you I already have an ISA a/c with Virgin and I like the shorter 60 day notice period for their FRISA's. So happy to get a marginally lower interest rate than elsewhere.

I could be completely wrong on my prediction however!!!!

silvermum

lohr500 said:

Over the past year or so, with rising inflation numbers, it has been a tough one deciding whether to sit tight and hope for a better rate soon, or take what's on the table at the time.

Personally I think inflation rates will start to reduce sometime soon and lagging behind a reduction in interest rates. So I have just grabbed the Virgin 5.05% 1 year FRISA to transfer an old money variable rate ISA into.

Like you I already have an ISA a/c with Virgin and I like the shorter 60 day notice period for their FRISA's. So happy to get a marginally lower interest rate than elsewhere.

I could be completely wrong on my prediction however!!!!

Yes, that’s sort of my thinking too, and the 60 day penalty means that if rates rise a lot more then it may still be worth a switch.

I have another ISA maturing in October so that could mop up a higher rate if rates are still rising 😬

Noneforit999

That is currently what I am trying to work out.

I have £20k to put into a fixed savings account and being a 40% tax payer means at 6%, I am well over the £500pa so a cash ISA seems the best option

I have just opened the one with Charter at 5.2% which seems a decent deal. The online guide says 1.25% for comparison between ISA and non ISA so I would need to get 6.5% in normal savings and I suspect 6% is going to be the best it might get to, although I could be wrong. 

boingy

If you think rates will go up, and I do, consider putting your ISA money into a non-fixed one for now and transfer it to another ISA if rates improve. It's a bit of a balancing act because you'll be getting lower interest now in the hope of getting higher interest later.  Note that you have to transfer the ISA to another one not just withdraw the money and put it into a new one. If you try to transfer from a fixed ISA they will charge you an interest penalty (typically 60 to 180 days, depending upon the provider).

Alternatively put it into the best fixed rate you can find today and try not to be unhappy if better rates come along in a few months!

Shedman

Noneforit999 said:

That is currently what I am trying to work out.

I have £20k to put into a fixed savings account and being a 40% tax payer means at 6%, I am well over the £500pa so a cash ISA seems the best option

I have just opened the one with Charter at 5.2% which seems a decent deal. The online guide says 1.25% for comparison between ISA and non ISA so I would need to get 6.5% in normal savings and I suspect 6% is going to be the best it might get to, although I could be wrong. 

You being a 40% taxpayer a non ISA would have to be close to 8.7% to be equivalent to the 5.2% ISA after tax by the way

Noneforit999

Shedman said:

Noneforit999 said:

That is currently what I am trying to work out.

I have £20k to put into a fixed savings account and being a 40% tax payer means at 6%, I am well over the £500pa so a cash ISA seems the best option

I have just opened the one with Charter at 5.2% which seems a decent deal. The online guide says 1.25% for comparison between ISA and non ISA so I would need to get 6.5% in normal savings and I suspect 6% is going to be the best it might get to, although I could be wrong. 

You being a 40% taxpayer a non ISA would have to be close to 8.7% to be equivalent to the 5.2% ISA after tax by the way

Thanks, In which case the ISA seems a no brainer then

auser99

Halifax and Lloyds have just announced pretty much market leading or equalling ISAs.

Lloyds at 5.45% 1 year and 5.50% 2 years will surely encourage others to up the ante soon.

Harry227

auser99 said:

Halifax and Lloyds have just announced pretty much market leading or equalling ISAs.

Lloyds at 5.45% 1 year and 5.50% 2 years will surely encourage others to up the ante soon.

Can I ask where you are seeing those rates?  On the LLoyds website it quotes 1yr ISA at  4.95% fro a 1 yr fixed https://www.lloydsbank.com/savings.html#c_115_accordion_2305

Meanwhile Principality are offering 5% at 1 yr fixed. https://www.principality.co.uk/savings-accounts/isas

Thanks.

GlasgowExpat2

Harry227 said:

auser99 said:

Halifax and Lloyds have just announced pretty much market leading or equalling ISAs.

Lloyds at 5.45% 1 year and 5.50% 2 years will surely encourage others to up the ante soon.

Can I ask where you are seeing those rates?  On the LLoyds website it quotes 1yr ISA at  4.95% fro a 1 yr fixed https://www.lloydsbank.com/savings.html#c_115_accordion_2305

Meanwhile Principality are offering 5% at 1 yr fixed. https://www.principality.co.uk/savings-accounts/isas

Thanks.

Lloyds Bank and Halifax increase interest rates across savings accounts – full list | Personal Finance | Finance | Express.co.uk