ISSN 2631-570X (Online)

12 January 2021

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AER	£1K	£5K
CASH ISAs
Easy Access	-	-
Notice Variable	-	-
1 Year Fixed	-	-
2 Year Fixed	-	-
3 Year Fixed	-	-
4 Year Fixed	-	-
5 Year Fixed	-	-
Lifetime ISAs	-	-

AER	£10K	£50K
VARIABLE RATES
Easy Access	-	-
1 Month	-	-
3 Months	-	-
3 Months +	-	-

AER	£10K	£50K
FIXED RATES
1 Year	-	-
1 Year	-	-
2 Year	-	-
3 Year	-	-
4 Year	-	-
5 Year +	-	-

AER	£10K	£50K
OFFSHORE ACCOUNTS
Variable	-	-
Fixed	-	-

AER	£10K	£50K
BUSINESSES Charities, Clubs, Pension Funds, Client A/cs etc
Variable	-	-
Fixed	-	-

AER	£25pm	£100pm
REGULAR SAVINGS
Variable	-	-
Fixed	-	-
ISA	-	-

AER	£100	£1K
CHILDRENS ACCOUNTS
Variable	-	-
Fixed	-	-
JISA	-	-

Full list of Guides

This week, United Trust Bank increased the rates on its 15-month, two, three, and five-year fixed rate bonds, resulting in them offering competitive rates for their terms. UTB 15 Month Bond pays 0.75% gross, UTB 2 Year Bond pays 0.80% gross, UTB 3 Year Bond pays 1.00% gross, and UTB 5 Year Bond pays 1.25% gross. All bonds pay interest on anniversary and require a £5,000 minimum deposit to open. These bonds do not allow further additions or withdrawals. They must be opened online but can then be
managed by post, by phone
and online.

New chart-topping ISAs

This week, Secure Trust Bank launched chart-topping two and three-year fixed rate ISAs. 2 Year Fixed Rate Cash ISA offers a joint chart-topping rate of 0.75% gross yearly until 14.02.2023 and 3 Year Fixed Rate Cash ISA tops the chart offering 0.80% gross yearly until 14.02.2024. Both ISAs require a £1,000 minimum deposit to open. These ISAs allow further additions from a minimum addition of £1,000 within 30 days of account opening. Earlier access is permitted on closure only and subject to 180 days’ loss of interest on the two-year version and 210 days’ loss of interest on the three-year version. Transfers in from cash ISAs are permitted. Transfers out are subject to the same interest-loss penalty as earlier access. These ISAs must be opened online but can then be managed by phone and online.

At the same time, Secure Trust Bank launched a chart-topping three-year bond and a highly competitive two-year bond. 2 Year Fixed Rate Bond pays 0.81% gross yearly until 14.02.2023 and 3 Year Fixed Rate Bond pays 1.01% gross yearly until 14.02.2024. Both bonds require a £1,000 minimum deposit to open. They allow further additions within 30 days of account opening, and the minimum addition permitted is £1,000. Withdrawals are not permitted. Both bonds must be opened online and can then be managed by phone and online.

ISA rates rise

United Trust Bank increased the rates on its five and seven-year fixed rate ISAs this week. ISA 5 Year Bond pays 1.00% gross on anniversary and ISA 7 Year Bond pays 1.20% gross on anniversary. Both ISAs require a £15,000 minimum deposit to open. They do not permit further additions. Earlier access is allowed subject to a penalty. Transfers in are accepted. Transfers out are subject to an interest-loss penalty. Both ISAs must be opened by post but can then be managed by post, by phone and online.

One-year bond end date moved

This week, first direct moved the end date on its one-year fixed rate bond by three weeks. Fixed Rate Savings pays 0.30% gross on maturity on a £2,000 opening minimum deposit and now has an end date of 27.01.22. To open this account, a first direct 1st

Children’s accounts

Encouraging children to save from an early age is a good idea and most providers offer accounts aimed specifically at children.

The top-paying children’s account that is open to all currently on the market comes from HSBC. MySavings is an instant access account for those aged between seven and 17 years and pays a variable rate of 2.47% gross monthly, although it should be noted that 0.25% gross is paid on balances of £3,001 and over. This account requires an opening minimum deposit of £10. It must be opened in branch, but can then be managed in branch, by phone, online and via mobile app. To operate the account online or via mobile app, you must have a MyAccount current account. Unlimited further additions are allowed. Withdrawals are permitted but a parent/ guardian’s signature is required for withdrawals of £50 or over for under 11’s. As an extra incentive, a free moneybox is available when you open this account and a MyAccount current account is opened on the child’s 11th birthday.

Account is needed. Further additions are not allowed, however further accounts can be opened while the issue remains open. Earlier access is permitted on closure only and subject to a £100 charge. The bond can only be opened and managed by phone.

60-day notice account launched

Secure Trust Bank launched a 60-day notice account this week. 60 Day Notice Account pays 0.61% gross quarterly on a £1,000 opening minimum deposit. This account allows unlimited further additions of £1,000 or more. Up to four interest withdrawals are permitted per annum and three capital withdrawals are permitted per annum on 60 days’ notice. The account can only be opened online but can then be managed by phone and online.

ISA end dates moved

Britannia moved the end dates by two months on its one and two-year fixed rate ISAs. Fixed Rate Cash ISA – 31/01/2022 pays 0.15% gross yearly and Fixed Rate Cash ISA – 31/01/2023 pays 0.20% gross yearly. Both ISAs require a £1 minimum deposit to open for transfers in or a £5,000 minimum deposit to open for new money. Both ISAs allow further additions while the issue remains open. They both permit earlier access subject to 180 days’ loss of interest. Transfers in from cash ISAs are allowed. Transfers out are subject to the same interest-loss penalty as earlier access. These ISAs can be opened in branch, by phone or online and then managed in branch and by post.

Bonds end dates moved

This week, Santander moved the end date on its one-year fixed rate bonds by one month. 1 Year Fixed Rate Bond pays 0.15% gross yearly and 123 1 Year Fixed Rate Bond pays 0.20% gross yearly. Both bonds require a £500 minimum deposit to open and now have an end date of 01.02.22. The 123 1 Year Fixed Rate Bond is only available to existing 123 World or Select customers. Further additions and withdrawals are not permitted on either bond. They can both be opened in branch, online or via mobile app and then managed in branch and by phone. For those looking to supplement their income, there are versions of both bonds that pay interest monthly at the same gross rates.

At the same time, Santander moved the end date on its two-year fixed rate ISA by one month. 2 Year Fixed Rate ISA pays 0.20% gross yearly on a £500 minimum opening deposit. This ISA now has an end date of 01.02.23. It allows further additions until 28.02.21. Earlier access is permitted on closure only and subject to 120 days’ loss of interest. Transfers in are accepted, transfer requests must be received within 14 days of account opening for external transfers and by 28.02.21 for internal transfers. Transfers out are subject to the same interest-loss penalty as earlier access. This ISA can be opened in branch, online or via mobile app and then managed in branch and by phone.

Competitive six-month bond

This week, Bank of London and The Middle East (BLME) continued to offer its competitive six-month fixed rate bond. Premier Deposit Account pays an expected profit rate of 0.50% gross on maturity on a £1,000 minimum opening deposit. To open this bond, a BLME transfer account is needed to hold funds pending investment. This bond does not permit further additions or withdrawals. It can only be opened online and must be managed by post.

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Ask Rachel

Working in the financial industry for over 30 years, Rachel Thrussell is the leading independent expert on UK savings products. Her views are constantly in demand from both the industry and the press.

What is the difference between an instant access account and a no notice account?

As its name suggests, instant access accounts allow savers immediate access to funds held within the account, although they’ll often require branch access for the privilege. While no notice accounts allow money to be withdrawn without notice, funds are usually transferred by BACS or issued by cheque, and so can take a bit longer to arrive in the account holder’s hands. These accounts are typically operated by post, telephone or online. In order to distinguish between the two types of account on Savers Friend, in the Easy Access charts you’ll see those accounts that are truly instant access are labelled ‘Instant’ in the column marked ‘Term/Notice’, while those that are no notice accounts are labelled ‘None’. You can sort according to these criteria by clicking the green arrows.

Get your savings questions answered by Rachel by emailing rachel@saversfriend.co.uk We regret we cannot answer emails personally

This week's
average rates

How do your savings compare?

No Notice	0.17%
Notice	0.41%
Cash ISA	0.44%
1 Year Fixed Rate Bond	0.49%
2 Year Fixed Rate Bond	0.57%
3 Year Fixed Rate Bond	0.69%
4 Year Fixed Rate Bond	0.84%
5 Year Fixed Rate Bond	0.87%
12 January 2021

Alternative sources of income

The FCA warns consumers about investing in highly risky cryptoassets

The Financial Conduct Authority (FCA) has warned consumers of the dangers of investing in cryptoassets. The regulator stated: “If consumers invest in these types of product, they should be prepared to lose all their money.” Recently, some crytoassets, such as Bitcoin, have been gaining attention with investors, but the FCA raised concerns about these types of investments, including:

Consumer protection: Some investments advertising high returns based on cryptoassets may not be subject to regulation beyond anti-money laundering requirements.
Price volatility: Significant price volatility in cryptoassets, combined with the inherent difficulties of valuing cryptoassets reliably, places consumers at a high risk of losses.
Product complexity: The complexity of some products and services relating to cryptoassets can make it hard for consumers to understand the risks. There is no guarantee that cryptoassets can be converted back into cash. Converting a cryptoasset back to cash depends on demand and supply existing in the market.
Charges and fees: Consumers should consider the impact of fees and charges on their investment, which may be more than those for regulated investment products.
Marketing materials: Firms may overstate the returns of products or understate the risks involved.

Commenting on the FCA warning, Laith Khalaf, financial analyst at AJ Bell, said: “Irrespective of what you think the future for cryptocurrencies might be, there’s no denying that they are highly volatile and therefore sit at the precarious end of the risk spectrum. Products that are linked to cryptocurrencies might also be complex and hard to understand, further muddying the waters. Consumers probably can’t fall back on the Financial Services Compensation Scheme if things go wrong either.

“Much has been made of the fact that Ruffer, an investment company known for its conservative investment style, recently invested in Bitcoin for the first time. However, it’s important to note that the investment manager only invested around 2.5% of a portfolio that is otherwise invested in more traditional assets. Even if things go wrong in the cryptomarket, they have protection in their other investments.

“The fear is that consumers are leapfrogging stocks and bonds and going straight from cash to Bitcoin, in the mistaken belief it’s much the same. Buying Bitcoin and other cryptocurrencies should be something you do with money you are prepared to lose and after you have already built up a sizeable portfolio. If you haven’t got a stocks and shares ISA, then you should seriously stop and consider whether you should be investing in Bitcoin.”

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The FCA warns consumers about investing in highly risky cryptoassets

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