Archived article: This article was correct at the time of publishing. Tax, investments and pension rules can change over time so the information below may not be current.

The ever-present need to review your cash ISAs

National Savings & Investments (NS&I), the savings body controlled by the Treasury, announced on 15 September that it has decided to reduce the rate on its Direct ISA from 1.5% to 1.25%. The reduced rate will be introduced on 16 November.

 Sam Coppin Sam Coppin
16 September 2015

This, along with recent stories about banks moving savers to new cash ISA products (products that often come with a lower interest rate than their predecessors) means it is important to get the very best deal on your cash ISA.

With interest rates still at historically low levels it can be easy to dismiss a relatively small difference in rates as insignificant, but a 1% variance in the interest rate on a deposit account worth £20,000 is equal to more than £1,000 in interest when compounded over five years.

So what options are available to ISA savers currently in low-rate accounts?

1) Switch to an alternative variable cash ISA account

A number of websites, including our own, provide a list of the best ISA rates currently available. Most cash ISAs are 'variable rate', meaning the rate received will change depending on the current Bank of England base rate and providers' discretion. Many of these accounts include bonus periods after which the interest rates may be lowered.

2) Switch to a fixed-rate cash ISA account

If you are prepared to lock-in your money for a period of time then a fixed-rate account might be a better option, as the rates on offer normally beat those offered by variable accounts. If you want access to your money within the investment term then the provider will usually charge a penalty. You can explore some fixed rate cash ISA accounts here.

3) Transfer to an investment ISA

We have seen an increasing number of people look to transfer their cash ISA money into an investment portfolio within an ISA, as the potentially higher returns on offer can be appealing to those who are willing to accept some risk to the capital values.

You can transfer an old account and open a stocks and shares ISA with us. Whatever level of support you want with your ISA investing, we can help.

If you’re looking for the easy way to invest, our Ready-made Portfolios are the cost-effective way to have your investments managed. Our Investment Advisory Service lets you retain control over your investment decisions but gives you your own dedicated investment adviser supporting you along the way. And, if you want to invest your own way, you have access to our extensive (and free) investment research, which makes everything a breeze.

An ISA is a great way to save and it’s important that you make the most of the tax efficiency by achieving the best returns you can. We will be happy to help with any transfer you wish to make into an investment ISA with Bestinvest. To discuss this, give us a call on 020 7189 2400 or email us at


The value of your investments and the income from them can go down as well as up, and you can get back less than you originally invested. This email is not a personal recommendation, or advice to use any of our services. In particular the Cash ISA accounts highlighted are for information purposes only and should not be viewed as recommendations. Not all accounts accept transfers so it is worth checking with the bank or building society concerned before requesting forms.  You should also check whether your current provider levies any penalties for transferring out. It is important that you initiate any transfer through the new provider, rather than withdraw the money or close the account yourself, to ensure the ISA remains intact.