Be quick off the mark to land best ISA offers

You could lose out in more ways than one if you delay your investment, reports Chiara Cavaglieri

We may be a month into the new tax year but if you haven't found a home for your savings the sooner you act, the better.

Putting your cash in an individual savings account will mean the taxman can't get his hands on any returns and this year savers are enjoying a more generous limit of £11,280, of which £5,640 can be stashed in a cash ISA.

Unfortunately, there is little difference between the rates available on ISA products and non- ISA products, but the tax-free benefits speak for themselves.

Savers are already having to battle against inflation – the consumer price index is at 3.5 per cent – leaving ISAs as one of very few ways to get a positive return on your savings and a total no-brainer for 40 per cent taxpayers.

"This year the £5,640 invested for a full 12 months at 3.50 per cent will earn you £197.40 tax free," says Andrew Hagger from Moneynet. "But every month you delay your decision, you'll earn £16.45 less.

"Another reason to act sooner rather than later is that in previous years, many of the best rates have been cut or pulled completely by the end of May," he says.

There are new products out this week with Furness building society, Hanley Economic building society and Lloyds competing for business. But make sure you always compare any new deals with the best buys.

The new Lloyds three-year fixed-rate ISA pays 3.55 per cent or 3.85 per cent on balances over £10,000, for example, while the four-year deal pays 3.6 per cent or 3.9 per cent AER on £10,000.

"The new Lloyds three and four-year fixed-rate ISAs pay a reasonable return but fall short of the market leaders," says Mr Hagger, who cites the three and four-year fixed-rates from Halifax, paying 4.25 per cent and 4.35 per cent respectively.

Santander is also making a final push for its ISA range by extending its rates into May, although these rates could be withdrawn at short notice.

All of Santander's ISAs allow money in an existing ISA account to be transferred in and are available to new and existing customers.

The range includes a two-year fix paying 4 per cent and a one-year fix paying 3.5 per cent on balances of £2,500. If you do go for a fixed-rate be sure that you can commit to locking your money away for the duration of the term and remember that the rate will remain fixed even if the base rate increases.

If you don't want to fix, opt for an easy-access account instead. Santander's variable Direct ISA Issue 9 pays 3.30 per cent on balances of £2,500, with a 12-month bonus of 2.80 per cent but this isn't the highest paying easy-access account on offer.

"While there have been some great contenders, the Nationwide Flexclusive ISA paying 4.25 per cent is the current market leader, but you do need to be an existing FlexAccount customer to qualify," says Rachel Springall from Moneyfacts.co.uk

"Otherwise the Cheshire building society and the AA offer a decent 3.50 per cent, but consumers need to be aware that all three of these best buys include introductory bonuses."

Snapping up the best buy isn't the only consideration. If you have old ISA money languishing on a poor rate you will need to check whether these accounts accept transfers in.

You may decide to plump for an account that is paying slightly less to keep all your money under one provider. for example, the top-paying accounts from Nationwide, Cheshire building society and AA Savings will not permit transfers, so at 3.30 per cent, Santander's offering is the next best rate if you need to move your whole ISA pot.

If you took out an easy-access account with a short-term bonus last year, it's crucial that you know when that bonus will come to an end and act to switch before it falls or you could end up losing out on additional interest.

"If you've got an existing variable-rate cash ISA it is well worth reviewing to see if you can get a better deal elsewhere," says David Black from analysts Defaqto. "Also if you've got a maturing fixed-rate cash ISA do check the 'go to' rate because it may not be particularly impressive."

Independent Partners; request a free guide on NISAs from Hargreaves Lansdown

Sport
sportGareth Bale, Carl Froch and Kelly Gallagher also in the mix for award
News
Japan's Suntory Beverage & Food has bought GlaxoSmithKline's Lucozade and Ribena
news
News
A tongue-eating louse (not the one Mr Poli found)
newsParasitic louse appeared inside unfilleted sea bass
Life and Style
Out and about: for 'Glee' character Bert Hummel, having a gay son was a learning curve
lifeEven 'cool' parents need help parenting gay teens
PROMOTED VIDEO
Money
Anyone over the age of 40 seeking a loan with a standard term of 25 years will be borrowing beyond a normal retirement age of 65, and is liable to find their options restricted
propertyAnd it's even worse if you're 40
Arts and Entertainment
Perhaps longest awaited is the adaptation of Jack Kerouac’s On the Road with Brazil’s Walter Salles directing and Sam Riley, Kristen Stewart and Viggo Mortensen as the Beat-era outsiders
books
Arts and Entertainment
theatreSinger to join cast of his Broadway show after The Last Ship flounders at the box office
Life and Style
fashion'To start singing with Pharrell is not that bad, no?'
News
news
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Argyll Scott International: Risk Assurance Manager

    Negotiable: Argyll Scott International: Hi All, I'm currently recruiting for t...

    Argyll Scott International: Business Analyst - MGA - London Market - Insurance Broker

    £50000 - £60000 per annum + benefits: Argyll Scott International: A Business A...

    Ashdown Group: PR, Marketing & Events Executive - Southwark, London - £35,000

    £30000 - £35000 per annum + benefits: Ashdown Group: PR Marketing & Events Exe...

    Selby Jennings: C++ Developer – Hedge Fund – New York

    $80000 - $110000 per annum, Benefits: Bonus and Employee Investment Scheme: Se...

    Day In a Page

    In a world of Saudi bullying, right-wing Israeli ministers and the twilight of Obama, Iran is looking like a possible policeman of the Gulf

    Iran is shifting from pariah to possible future policeman of the Gulf

    Robert Fisk on our crisis with Iran
    The young are the new poor: A third of young people pushed into poverty

    The young are the new poor

    Sharp increase in the number of under-25s living in poverty
    Greens on the march: ‘We could be on the edge of something very big’

    Greens on the march

    ‘We could be on the edge of something very big’
    Revealed: the case against Bill Cosby - through the stories of his accusers

    Revealed: the case against Bill Cosby

    Through the stories of his accusers
    Why are words like 'mongol' and 'mongoloid' still bandied about as insults?

    The Meaning of Mongol

    Why are the words 'mongol' and 'mongoloid' still bandied about as insults?
    Mau Mau uprising: Kenyans still waiting for justice join class action over Britain's role in the emergency

    Kenyans still waiting for justice over Mau Mau uprising

    Thousands join class action over Britain's role in the emergency
    Isis in Iraq: The trauma of the last six months has overwhelmed the remaining Christians in the country

    The last Christians in Iraq

    After 2,000 years, a community will try anything – including pretending to convert to Islam – to avoid losing everything, says Patrick Cockburn
    Black Friday: Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

    Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

    Britain braced for Black Friday
    Bill Cosby's persona goes from America's dad to date-rape drugs

    From America's dad to date-rape drugs

    Stories of Bill Cosby's alleged sexual assaults may have circulated widely in Hollywood, but they came as a shock to fans, says Rupert Cornwell
    Clare Balding: 'Women's sport is kicking off at last'

    Clare Balding: 'Women's sport is kicking off at last'

    As fans flock to see England women's Wembley debut against Germany, the TV presenter on an exciting 'sea change'
    Oh come, all ye multi-faithful: The Christmas jumper is in fashion, but should you wear your religion on your sleeve?

    Oh come, all ye multi-faithful

    The Christmas jumper is in fashion, but should you wear your religion on your sleeve?
    Dr Charles Heatley: The GP off to do battle in the war against Ebola

    The GP off to do battle in the war against Ebola

    Dr Charles Heatley on joining the NHS volunteers' team bound for Sierra Leone
    Flogging vlogging: First video bloggers conquered YouTube. Now they want us to buy their books

    Flogging vlogging

    First video bloggers conquered YouTube. Now they want us to buy their books
    Saturday Night Live vs The Daily Show: US channels wage comedy star wars

    Saturday Night Live vs The Daily Show

    US channels wage comedy star wars
    When is a wine made in Piedmont not a Piemonte wine? When EU rules make Italian vineyards invisible

    When is a wine made in Piedmont not a Piemonte wine?

    When EU rules make Italian vineyards invisible