Sunday Express - - Your Projects Count -

You can get slightly more if you fix, for ex­am­ple, Skip­ton Build­ing So­ci­ety and Paragon Bank of­fer on­line ac­counts pay­ing 1.20 per cent over two years, while Paragon pays 1.75 per cent on its five-year bond. Cash Isas have also been un­der­mined by the per­sonal sav­ings al­lowance, which al­lows ba­sic rate tax­pay­ers to take £1,000 a year in in­ter­est from non-Isa sav­ings without pay­ing in­come tax, or £500 for higher rate tax­pay­ers.

Si­mon Healy, man­ag­ing di­rec­tor of chal­lenger bank Al­der­more, says cash Isas still have a role to play, par­tic­u­larly for higher rate tax­pay­ers. “Its tax-free sta­tus is help­ful for long-term savers with larger pots and will be­come even more im­por­tant as in­ter­est rates start to in­crease.”

While cash Isas floun­der, stocks and shares Isas have raced ahead to grow 15.8 per cent over the past year, their strong­est per­for­mance for seven years.

Richard Eagling, head of pen­sions and in­vest­ments at MoneyFacts, says too many savers are los­ing out.

“Cash Isas re­main the de­fault choice de­spite low in­ter­est rates, and savers have missed out on the mer­its of stocks and shares Isas.”

Many will be tempted to in­vest more in the stock mar­ket but be warned, there is no guar­an­tee that its re­cent strong run will con­tinue. This spe­cial Isa sup­ple­ment should help you de­cide where to put your money.

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