If you want to put your money into a cash ISA, which accounts pay the highest rates?
Cash ISAs work in much the same way as standard savings accounts, but the interest you earn is always tax-free. You can learn more about how they work and whether this type of account is suitable for you in our article How cash ISAs work.
Fixed rate cash ISAs
You usually, but not always, get a higher rate of interest on fixed rate cash ISAs, which as the name suggests pay a fixed return for a set period of time. You normally can’t take money out of these accounts until the end of the term.
More importantly, you often only have a month or so to pay money into these accounts. You can’t normally top them up or pay into them on a monthly basis.
Current best buys, according to savings website SavingsChampion.co.uk are as follows:
1 Year:
Metro Bank
One-Year Fixed Rate Cash ISA
Pays: 5.71%
Min investment: £1
The small print: Access on closure only, subject to 180 days’ loss of interest. Transfers in are allowed. This is not a flexible ISA. This is not a portfolio ISA. On maturity, the account is transferred to the Instant Access Cash ISA. Interest is paid on the 5th of April each year and on maturity.
Find out more at: Metro Bank
2 Year:
Monmouthshire Building Society
Two Year Fixed Rate Cash ISA – Issue 26
Pays: 5.25%
Min investment: £1,000
The small print: Access on closure only, subject to 180 days’ loss of interest. Transfers in from other providers are allowed. This is not a flexible ISA. This is not a portfolio ISA. On maturity, the account is transferred to the currently available variable rate cash ISA, or its nearest equivalent. Interest is paid on the 31st of March each year and on maturity.
Find out more at: Monmouthshire Building Society
3 Year:
The Nottingham
Fixed Rate ISA Issue 157
Pays: 4.90%
Minimum investment: £500
The small print: Withdrawals aren’t allowed until the account matures on 14/12/2026. Transfers in are allowed. This is not a flexible ISA. This is not a portfolio ISA. On maturity, the account is transferred to the instant access Cash ISA or nearest equivalent. The maturity date is 14/12/2026. Interest is paid on the 31 October each year and on maturity.
Find out more at: The Nottingham
5 Year:
Hinckley and Rugby Building Society
Five Year Fixed Rate Cash ISA Issue 5
Pays: 4.90%
Minimum investment: £500
The small print: At maturity of the fixed rate term, the account will automatically become a 7 Day Notice Cash ISA and the interest rate will be variable. During the fixed rate term you may withdraw all or part of your investment (this includes an ISA transfer to another organisation), but if you do so you will lose a sum equivalent to 365 days’ gross interest on the amount withdrawn. Transfers in are not permitted. Interest is paid annually on the 5th April.
Find out more at: Hinckley and Rugby Building Society
Rates correct as at 27.11.23
Variable rate cash ISAs
If you’d rather not tie up your cash savings, and prefer to have your money readily accessible in the event of an emergency, a variable rate cash ISA is likely to be your best bet.
Current best buy instant access cash ISAs include:
Metro Bank
Instant Access Cash ISA (Limited Edition)
Pays: 5.11%
Minimum investment: £500
The small print: Easy access. Rate of 5.11% AER paid out for 12 months if the account is funded by at least £500 within the first 28 days of account opening. Allows transfers in. This is a flexible ISA. Interest paid annually on the 5th April.
Find out more at: Metro Bank
Moneybox
Moneybox Cash ISA
Pays: 5.09%
Minimum investment: £500
The small print: Easy Access. Up to three withdrawals can be made within a 12-month period from the date of opening the Cash ISA without affecting the interest rate. If four or more withdrawals are made, a lower rate of 0.75% will be applied for the remainder of the 12-month period. Rate includes a 0.85% bonus rate for the first 12-months.
Cash ISA transfers in are accepted. Interest is accrued daily but paid on account open anniversary. This is not a flexible ISA.
Because Moneybox is not a bank, funds they hold on behalf of customers are deposited across a range of third-party banks. These banks are covered by the Financial Services Compensation Scheme (FSCS). Moneybox Cash ISA funds are currently deposited with Santander UK Plc and HSBC Bank PLC, with 50% of your deposit held with each. Be aware that any funds that you already hold with Santander UK Plc or HSBC Bank PLC will also count towards your FSCS limit.
Find out more at: Moneybox
Zopa
Easy Access ISA
Pays: 5.08%
Minimum investment: £1
The small print: Easy Access. Interest is paid monthly.
Find out more at: Zopa
Cynergy Bank
Online ISA (Issue 43)
Pays: 5.07%
Minimum investment: £1
The small print: Easy access. Transfers in accepted from other cash ISAs at the time of application. This is not a Flexible ISA. Interest is paid annually.
Find out more at: Cynergy Bank
Principality Building Society
Online Bonus ISA
Pays: 5.06%
Minimum investment: £1
The small print: Easy access. Rate includes a variable 0.96% bonus for the first 12 months. Transfers in are allowed. This ISA is flexible. Interest is paid on 6 April each year.
Find out more at: Principality Building Society
Rates correct as at 27.11.23
Remember…
Once you’ve chosen a cash ISA account, you can’t simply deposit your money and forget about it. Rates change constantly, so you’ll need to keep an eye on how much interest you’re earning and move your money if you can find better returns elsewhere.
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