Banks Withdraw ISA Accounts
Some of the top selling cash ISA accounts have been withdrawn completely and others have had their rates lowered. Bank of England figures show that cash ISAs were paying an average return of just 0.42% in April 2009 down from 0.63% in a month before.
The drop is even more substantial from April 2008 when investors were earning from their fixed rate cash ISAs an average return of 4.81% as a consequence of the financial crisis and global recession.
Banks and building societies have withdrawn their best ISAs during the last month which indicates they have again been inundated with savers looking for the best deal while other savings rate have hit rock bottom.
- Barclays’ Golden ISA has been lowered to 2.58%, from its original rate of 3.61% including a 1% bonus.
- Halifax’s Direct Reward ISA - 3%, is no longer available.
- National Counties’ Guaranteed Cash ISA - 3.26%, has also been withdrawn.
- First Direct’s E-ISA - 3.06%. This last one being lowered to a gloomy 0.2%.
Climbing up the Ranking Table
There are still a few deals left on the board that have outranked the top-selling Golden ISA from Barclays. All of them accept transfers of up to £43,200, as transfers in are allowed:
- Ruffler Bank - Cash ISA, offering a 3.11%. Savers must give a 30 days’ notice to cash out.
- Marks & Spencer Money - Advantage Cash ISA, offering a 3.1% plus a 1% bonus till April 2010. £10,000 Minimum investment.
- Newcastle Building Society - Reward Saver ISA, paying 3% including a 1% bonus for 12 months. £500 Minimum and savers must give a 120 days’ notice to liquidate.
The Fixed Rate Annual Cycle
ISA providers are interested in taking your full ISA allowance in a lump sum around April, just before and just after the end of the tax year. So, if you are shopping around for the most competitive fixed rate cash ISA in the market, you are better off waiting for March 2010. Nevertheless, the economy is clearly showing a long term depreciation of the fixed rate offered by savings providers due to the financial crisis, so don’t expect to match the figures from the past few years.
Rates on Cash ISAs are subject to constant changes. In many occassions the best offers are only available for a short period of time so if you want to make sure you don’t miss any opportunities you can sign in to the best weekly newsletter in the subject: Martin Lewis’ Money Saving Expert.
Or search on any of the following comparison sites:
This post has one comment
August 12th, 2009
I have 3 cash isa’s with my bank. Which in the last few years haven’t been doing that well that anyways. In fact I lost money on my equity isa this year. Could my isa account be in any jeopardy of being closes? I’m a retired old mans that would like to still make some descent gains before its to late. I’m sick of leaving my money in the banks hands when they are the ones that got us in the mess to begin with.