The best deals for savers are currently on offer at the challenger banks. However, if you would prefer to put your money in an institution with a more familiar name you do not necessarily have to accept a deplorably low rate of interest. Yet you must still be alert to the terms and conditions of some accounts. Take, for example, the bonus account where the initially generous rate falls after a set period of time. Does the bank hope that you will forget this deadline and fail to move your money elsewhere? Here are some of Moneyfacts’ current best buys.
- Post Office Money’s Online Saver Issue 16has a rate of 1.61 per cent. However, this does include a bonus rate of 0.96 per cent for the first 12 months. After that the rate will revert to its underlying rate, currently 0.65 per cent gross/AER variable.
- Virgin Money’s Defined Access Saver Issue 2 has a rate of 1.51 per cent, but if you withdraw cash from the account more than three times, it will only pay 0.75 per cent on the remainder of the year.
- When it comes to easy access cash Isas, Virgin Money comes out on top. Its Defined Access Isa Issue 3 has a rate of 1.56 per cent but this will drop to 0.75 per cent if you make more than three withdrawals.
- Post Office Money’s online Isa — the Easy Access Issue 3 — has a rate of 1.51 per cent; this includes a bonus of 0.86 per cent for 12 months.
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- Monmouthshire Building Society’s cash Isa 7, National Savings & Investments’ Direct Isa and Post Office Money’s Premier cash Isa Issue 10 all offer a rate of 1.5 per cent. The latter includes a bonus of 0.85 per cent for first 18 months and savers can only make two withdrawals in a year.
- The best two-year fixed-rate cash Isa is Mansfield Building Society’s Nisa Bond (2nd issue), which has a rate of 2.1 per cent; the penalty for withdrawing funds within the two years period is 180 days of interest.
- Virgin Money’s Issue 165 has a rate of 2.06 per cent, with an early access penalty of 90 days, while Coventry Building Society’s Isa (31) offers 2.05 per cent, with an early access penalty of 120 days.