Where do I find the best fixed rates?

Daily Mail - - Money Mail -

NORTH­ERN Rock has launched a fixed-rate bond pay­ing 2.4pc af­ter tax (3pc be­fore) for one year. The bond, where the rate is fixed un­til July 1 next year, is avail­able only through the post.

ICICI Bank has also in­creased the rate on of­fer on its in­ter­net-based Hi-Save ac­count to 2.4 pc (3pc) to new savers will­ing to tie their money up for 12 months.

They join Post Of­fice, where the de­posit-taker is Bank of Ire­land, and Barns­ley Build­ing So­ci­ety — now part of York­shire BS — in pay­ing this top rate.

If you are will­ing to tie your money up for two years, you can earn 2.8pc (3.5pc) with North­ern Rock but a slightly higher 2.96pc (3.7pc) with ICICI Bank or the Post Of­fice. Hal­i­fax pays 2.84 pc (3.55 pc) and Saga — where the de­posit taker is Hal­i­fax Bank of Scot­land (HBOS) — 2.88 pc (3.6 pc)

Top deals on tax-free fixed-rate Isas for one year come from the Post Of­fice, which pays 3 pc tax-free.

But some banks and build­ing so­ci­eties con­tinue to pay less to Isa savers than on tax­able fixed-rate bonds.

North­ern Rock pays 2.75 pc fixed for a year on its Isa, against 3 pc on its tax­able bond. At Hal­i­fax you earn 3 pc fixed for two years on its cash Isa, 0.55 per­cent­age points less than it pays on its sim­i­lar tax­able fixed-rate bond.

Even worse, over three years Hal­i­fax of­fers 3.35 pc on its fixed-rate cash Isa, 0.65 points less than the 4 pc be­fore tax on its tax­able bond.

The best two-year fixed-rate Isa comes from San­tander at 3.5 pc, but you need a min­i­mum £10,000 to earn this rate. Be­low this, the rate is 3 pc.

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