More ISA savers choosing fixed rates
Savers seeking tax-free returns have switched their Cash ISA preferences while the Bank Base Rate has remained at its historic low, Leeds Building Society has discovered.
When the Bank of England cut Base Rate to 0.5% on 5th March 2009, almost three times as many ISA savers chose the Society’s variable rate ISAs over fixed rate products.
Since then this trend has been reversed and the majority of ISA savers have tended to prefer fixed rate products – in March this year almost three fifths of ISA savers (57.3%) held a fixed rate product, compared to 42.7% who had chosen a variable rate account.
The overall popularity of Cash ISAs among savers with Leeds Building Society has risen over the same period.
In March 2009, ISAs accounted for almost one in four savings products (24.4%) with the Society, while at the end of March this year that figure was more than one in three (35.2%).
“ISAs are consistently our most popular type of savings product, which is not surprising bearing in mind the tax-free returns they offer,” said Kim Rebecchi, Sales & Marketing Director at Leeds Building Society.
“Customers frequently ask for a simple savings account but this can leave them paying tax unnecessarily.
“Every adult saver should have an ISA – over time they have been seen to become a perk for the better-off but whatever your level of savings, an ISA should always be your first choice of savings account because of the tax-free interest. Among its savings range, Leeds Building Society offers Cash ISAs with a minimum subscription and operating balance of just £1.”
Notes to Editors
Leeds Building Society has 67 branches throughout the UK, Gibraltar and Ireland and assets of £11.2bn (as at 31 December 2013). The Society has operated from the centre of Leeds since 1886.