Best Cash ISA paying guaranteed 4.28% before limits cut | Personal Finance | Finance
A Cash ISA is promising to pay savers a market-leading 4.28% interest rate right now, regardless of what happens to limits in next month’s Autumn Budget.
According to financial experts, the Government is preparing to slash Cash ISA limits in half in the November spending plans, from the current £20,000 limit to just £10,000, while keeping the overall £20,000 ISA limit in place to encourage savers to invest in a Stocks and Shares ISA instead.
To make matters worse, savings rates have fallen ‘across the board’ in recent weeks following Bank of England base rate cuts.
But with a £20,000 limit currently still in place for Cash ISAs, now is a good time to lock in a fix and maximise the deposit limits before any such limit cuts are put in place.
There is a fix on the market right now which will protect from rate cuts and will allow you to max out your current £20,000 Cash ISA limit for this financial year, whatever happens in next month’s Budget, as it’s unlikely any changes would take effect until at least the next tax year in April 2026.
Comparison site Moneyfacts picks out Vida Savings as its top 1-year fixed Cash ISA. It pays 4.28% and the rate is guaranteed for at least 12 months, so even if the Bank of England cuts interest rates again, you will keep your 4.28% rate for 12 months from the date of opening. Martin Lewis’ MSE also picks Vida Savings as its top one-year fix.
Vida says about its Cash ISA: “Start saving from £100, tax-free. Make unlimited deposits for the first 21 days, subject to your ISA allowance. Withdrawals are permitted, subject to loss of interest. Withdrawals are permitted, subject to loss of interest.”
Close behind is Investec’s one year fix at 4.27%, and Tembo also offers 4.27%.
For a big-name brand, Natwest is offering 4.2% fixed for one year but has a minimum £1,000 pay-in.
For new customers, Trading212 offers a 4.51% Cash ISA right now, but it’s variable, which means the rate will drop every time the Bank of England cuts its rates, though it will also increase if the BoE raises rates. It’s worth noting that the Bank is not expected to raise interest rates in the near future, so a one-year fix at 4.28% may end up working out better in the long run.
