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Best cash ISA – Including details of the leading rates in the UK

By Antonia Medlicott

  • Published: May 24, 2024
  • Edited by: Clare West
  • Last Update: 1 week ago
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I’ve identified the best cash ISA rates in the UK on platforms that offer a bunch of other great features. Opening an account is done online so you can be earning up to 5.2% within minutes.

My quick list

*We don’t make any money from the platforms for recommending them on this list. These are my totally impartial views that I think represent the best value for money.

4.5
Trading 212

At 5.2%, this is the leading cash ISA in the UK at an extremely low cost.

Capital at risk.

4.5
Plum

5.17% AER – Easy access.

Capital at risk.

4.0
Chip

5.10% AER – Variable, flexible.

Capital at risk.

4.5
Moneybox

4.75% AER (variable)

Capital at risk.

My tip: Be aware of the rules surrounding this product before you open an account as there are penalties involved should you access your money for anything other than purchasing your first home, or retirement.

*Not sure how to choose? Skip to my tips on how to choose the best Lifetime ISA.


4.5

Trading 212

At 5.2%, this is the leading cash ISA in the UK at an extremely low cost.

Capital at risk.

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Reasons to use

  • Zero account fees for saving or investing
  • Top interest rate on a cash ISA of 5.2% APY
  • Flexible ISA
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Reasons to avoid

  • Customer service can be variable
  • Does not connect to your banking app so you need your online banking login details

Antonia says

Trading 212 already appears on many of our ‘Best of' lists at Investing Insiders. We were already fans of their exceptional value and uncomplicated interface, but now they have rolled out the leading cash ISA on the market with a rate of 5.2% and you still have no account fees to grapple with.

This literally means that there is no reason why I wouldn’t recommend this platform to savers. And if you can put aside some of your money for a minimum of five years, there are some great investment options here too.

Fees

None, zero, nada….this is a free account with an excellent rate and access to investment accounts

Scores

Fees:

5.0

Trading platform:

4.0

Account opening:

4.0

Research:

4.0

Education:

2.0

Customer service:

2.5

4.5

Plum

5.17% AER – Easy access.

Capital at risk.

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Reasons to use

  • Excellent savings algorithms
  • Zero account fees for the Cash ISA
  • Access to a pension product and commission-free trades on stocks
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Reasons to avoid

  • Rate drops to 4.29% after 12 months
  • Maximum of 3 penalty-free withdrawals per year
  • Subscription charge for access to fund investing

Antonia says:

I’ve had an account with Plum since 2021 and can confirm that it is an excellent way to save money. The algorithm analyses your income and expenditure in order to put aside small amounts that you can afford. You literally won’t notice the money leaving your account.

Plum also has access to investing and a personal pension. This is a really easy-to-manage app despite having multiple features. It would definitely suit a beginner, although I’ve happily left my account open as I enjoy the savings features and there is access to one of my favourite funds here in addition to the great savings rates.

Fees

Zero to pay for the cash ISA. There are additional subscription fees to access features such as fund investing, a Plum card, and price alerts.

Scores

Fees:

4

Trading platform:

4.5

Account opening:

4.5

Research:

3

Education:

3

Customer service:

3

4.0

Chip

5.10% AER – Variable, flexible.

Capital at risk.

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Reasons to use

  • Flexible meaning you can deposit and withdraw without affecting your allowance
  • Great savings and budgeting tools
  • Access to good investment funds
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Reasons to avoid

  • Tracker rate so can go up and down
  • £5.99 to use the stocks and shares ISA
  • Autosave features cost 45p per save.

Antonia Says

This is a decent rate but it is a tracker rate, which means it tracks at 0.26% below the Bank of England base rate. While this means that if the rate moves up, Chip account holders stand to gain, it also means the rate could go down at any time.

You can access the Chip cash ISA for free; however, a lot of their features come with a fee including autosaves which will cost 45p per save. These are free with Plum so that’s the consideration.

Fees

Zero fees to use the cash ISA but you will pay to use the automated savings tools.

Scores

Fees:

4.5

Trading platform:

4.0

Account opening:

5.0

Research:

2.0

Education:

2.5

Customer service:

3.5

4.5

Moneybox

4.75% AER (variable)

Capital at risk.

check

Reasons to use

  • Excellent place for investing and pension saving
  • Good range of savings accounts
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Reasons to avoid

  • Only allowed 3 penalty-free withdrawals per year
  • Rate drops to 4.25 after 12 months
  • Rate can go up or down at any time

We talk about Moneybox a lot at Investing Insiders as our analysis has shown that they are a great place for beginners to start investing. That being said, the rate on their cash ISA isn’t the best out there and it stands to drop further after 12 months so you may wonder why they made it onto this list.

The reason is, Moneybox is probably my first choice for anyone who is new to investing and would like to try and grow their wealth on the stock market. But not everyone has a starting capital, and that’s where the cash ISA could come in. If you set aside less than 12 months to grow your starting pot and deposit regular amounts into your account (there are good round-up tools etc to help you do this), then you could simply upgrade to a stocks and shares ISA at the end of the year and tap into one of their high performing funds.

Fees

Zero fees associated with the cash ISA
£1 subscription fee and 0.45% platform fee for investing

Scores

Fees:

3.5

Trading platform:

4.0

Account opening:

5.0

Research:

3.5

Education:

3.5

Customer service:

3.5

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What is a cash ISA?


A cash ISA is a savings account but unlike regular savings accounts, any interest you earn is free of any tax. If you are already using up your personal allowance, then saving into a cash ISA will allow you to keep more of your gains.

You can save up to £20,000 into a cash ISA each tax year, anything over and above that amount will be subject to tax at your regular rate.

What is the personal savings allowance?


The personal savings allowance refers to the amount of money you can earn from interest without having to pay tax on those earnings. Remember, that within a cash ISA, this isn’t an issue as your earnings are protected from the taxman. However, when using regular savings accounts, anything over the personal allowance is subject to tax. The personal savings allowance is as follows:

  • Basic rate taxpayers – £1,000 in interest per tax year
  • Higher rate taxpayers – £500 in interest per tax year
  • Additional rate taxpayers – no personal savings allowance

How much interest can you earn in a cash ISA?


This will depend on the provider and the current rate of interest they offer. Interest rates change all the time but at the time of writing, the best interest rate available in a cash ISA is 5.2% at Trading 212

How are the cash ISAs offered on these platforms different from the ones offered by a regular high street bank?


They are the same! All the rules and regulations surrounding the product remain the same regardless of who the provider is. The main difference between the platforms I have recommended in this article, and the high street banks, is that the cash ISAs here offer better interest rates.

Is my money safe when saving into one of these platforms?


Completely safe. All these platforms are authorised and regulated by the Financial Conduct Authority 9FCA0 and in addition offer protection to the value of £85,000 by the Financial Services Compensation Scheme (FSCS)

Is saving better than investing?


Not necessarily – these are two very different vehicles for growing your wealth. Saving is better for anyone who might need access to their wealth within the next five years, whereas, investing offers the opportunity for better returns but is considered a long-term endeavour of at least 5 years.

What is easy access?


There are two types of saving accounts – easy access, and fixed term. Fixed term means you will commit to leaving your money untouched in the savings account for a fixed period of time, usually in exchange for a better interest rate.

Conversely, easy access allows you to deposit and withdraw money whenever you like. What is interesting about this, is that at the time of writing this page, easy-access cash ISAs are offering the leading rates and there is therefore no advantage to locking your money away for a fixed term.

Should you use a savings account to save for buying your first home?


This depends on your age. If you are between the ages of 18 and 39, then a Lifetime ISA is a much better option as it attracts a government bonus of 25% on every deposit up to the value of £1,000 a year. You can either use this account to accumulate interest, or place your money into the stock market in order to grow a deposit.

For more information on Lifetime ISAs, and to find the best providers with the best returns at the lowest costs, go to my article here.

Can you transfer your existing cash ISA to another provider for a better rate?


Yes, and you should! However, it is really important that you don’t just withdraw your funds and deposit them with a new provider as this will inadvertently affect your ISA allowance. Contact the provider you wish to transfer to and ask for their assistance in doing an ISA transfer.

FAQs

A flexible cash ISA allows you to withdraw and deposit without affecting your ISA allowance. As an example, if I deposit £100 into a cash ISA that is NOT flexible, then withdraw £50, and deposit that amount back into the ISA, I would have used £150 of my ISA allowance. With a flexible ISA, this example would only use £100 of my ISA allowance.

Yes, at the start of this financial year, the rules surrounding ISAs were changed to allow consumers to open multiple accounts with different providers as long as they still remain within the ISA allowance across all the accounts.

Note from the insiders:


The interest rates on this list are correct at the time of publication. However, I would encourage savers to check the websites of the platforms for the latest rates.