Over £43billion is sitting in five million UK cash ISA accounts earning returns of 1.50% or less, with an average balance of over £8,500 per account – so check now to get a better rate
Millions of savers are missing out on potentially hundreds of pounds in interest a year because their cash ISA savings are languishing in low-paying accounts.
This is according to new research from Yorkshire Building Society and CACI, which suggests some cash ISAs are still paying 1.50% or less. In comparison, the best-paying easy access cash ISA pays up to 5.17%, or you can get up to 4.77% fixed for one year. The top easy access normal savings account pays up to 5.06% or up to 5.21% fixed for three months.
Over £43billion is sitting in five million UK cash ISA accounts earning returns of 1.50% or less, with an average balance of over £8,500 per account. But you can compare rates and switch elsewhere today to secure a better interest rate.
Chris Irwin, director of savings at Yorkshire Building Society, said: “It’s surprising to see such a large amount sitting in low paying ISA accounts after a period of significant increases to savings interest in the last two years. This data follows on from our analysis earlier in the year calling for consumers to take time to review their finances.
“The start of a new financial year gives the perfect opportunity to review finances and make the switch from low paying accounts. Although we’ve seen the Bank rate increase this analysis clearly shows that there are still many accounts which continue to pay low rates despite those increases.
“Its important savers take action and think about how they can make their hard-earned cash go as far as possible. Last year, our savings rates paid an average of 1.01% more than the market average rate so we are encouraging customers to review their savings and get the information they need to make sure they aren’t missing out.”
Rachel Springall, Finance Expert at Moneyfacts, said: “This research emphasises why consumers need to regularly check the rate they earn against the market and not presume they are getting a decent return. It is wise to make a diary note to proactively review and switch existing ISA pots to keep their tax-free wrapper and chase better returns. Leaving Cash ISAs unchecked or becoming apathetic can be costly, as savers may miss out on a better rate without realising it.”
