Battle Of The ISA’S
Amidst the aftermath of the credit crunch, the slowdown in the property market and reduced customer confidence, savings providers are now gearing up for this year's intake of tax-free ISAs (Individual Savings Accounts).
Several building societies including the Scarborough Building Society and Icesave, a division of Landsbanki of Iceland, have already launched their 'best-buy' cash ISA campaigns. With a minimum deposit requirement of £1,000 their tax-free savings accounts offer 6.3% and 6.1% respectively.
Following closely behind is the Loughborough Building Society paying out 6.1% in tax-free interest with initial deposits from as little as £1. Other building societies such as Kent Reliance, Principality and the Saffron have also upped their competitive spirit by raising their annual rates to 6.05%. Not bad deals at all for those who can afford to set aside some spare cash and watch it accumulate.
Despite the early start to the tax-free savings market this year, it is however expected that many of the attractive deals currently on display will disappear within a couple of months and become unavailable. The rush is now on to see who can cash in on the better deal.
This year however, the majority of the best buy deals in ISAs are not made up from accounts that usually top the popularity charts by paying out for limited periods only.
For consistent investment packages, the government-backed National Savings & Investments is always a favourable option. For the past 18 months NSI has proved very popular when it comes to ISAs offering a current tax-free interest rate of 6.5%.
On the internet saving side it is the e-ISA from the Yorkshire Building Society that has taken the lead as the top payer over 3 years, with its current annual rate of return on investment standing at 5.8%.
Published on February 8, 2008
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