How is interest calculated?
The interest rate is fixed at 4.00% gross AER for five years. Since writing the rate has changed to 2.95%.
Is interest accumulated to my savings?
Interest is paid annually and can be added to the ISA or paid away to a separate account nominated by the saver.
How long do I have to tie my savings up for?
Can I get access to my savings?
No withdrawals of capital are allowed during the five years that the account runs for, however interest can be paid away annually to a separate account.
How do I manage my account?
The account can be opened by downloading the United Trust Bank Transfer Application Form (Cash ISA), which can be found by clicking here.
Once opened the account is managed by post and on the telephone, United Trust Bank can be contacted on 020 7190 5599.
How much can I save?
A minimum transfer of £5,000 from an existing Cash ISA is required, no other contributions can be made.
How is the interest taxed?
Because this is a Cash ISA there is no tax to pay on any interest you receive.
What are the advantages of this account?
- The account is it is currently the most competitive Five Year Fixed Rate Cash ISA, which accepts a transfer in
- United Trust Bank are members of the UK Financial Services Compensation Scheme
- Interest can be paid away, which will help some savers looking to produce an ‘income’ from their savings accounts
What are the disadvantages?
- The minimum transfer amount of £5,000 will exclude some people with smaller balances in their Cash ISAs
- The account is not available online, which may be inconvenient for some savers
- There are other accounts from FSCS protected banks offering a higher rate of interest
- Future Cash ISA contributions will have to be made into a different ISA, this account does not accept transfer in
- Savings will be tied up for five years, with no access to the capital
The Investment Sense Verdict
Whilst this is the best interest rate for five year fixed Cash ISAs , which will accept a transfer in, savers have to consider whether they should tie up their savings for such a long period of time and also whether the higher interest rate is sufficient to compensate for giving up access to the savings for five years, during which time interest rates may have risen.
United Trust Bank is offering 3.55% on a three year fixed rate Cash ISA, which accepts transfers in, and some savers might want to tie up their capital for a shorter period of time, despite the slightly lower interest rate, in the hope that they can take advantage of any future rises in interest rates.
The Investment Sense verdict?
If you are looking for a long term fixed rate for a Cash ISA transfer then this is as good as it gets at the moment, but for many having the flexibility of a shorter term fixed rate will win out over a slightly higher interest rate.
Should you wish to discuss this account or ways of getting a real, above inflation, return on your savings, speak to one of our team of advisers today.