Yorkshire Building Society’s three-year Fixed Rate ISA account was highlighted as a “Pick of the Week” by MoneyFacts.co.uk this week. The account’s interest rate is fixed at 3.5 percent until October 31, 2025 and the interest is calculated daily on the cleared balances. Interest is paid annually, with the next interest payment dates being October 31 in 2023, 2024 and 2025.
Yorkshire Building Society states if a person deposits £1,000 when opening the account then at the end of the fixed term they will have earned £112.93 in interest.
On maturity, the balance will be automatically transferred into an Online instant access ISA.
People can also have the option to transfer the balance into another Fixed Rate eISA with Yorkshire Building Society without having to reapply.
People can open the account with just £100 and the maximum investment someone can make is £20,000 which is the ISA Allowance for 2022-23.
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People can however include previous years’ ISA transfers in their maximum balance.
The ISAs permitted to be transferred into the account include Cash or Stocks and Shares ISAs, Cash and Stocks and Shares LISAs and Innovative Finance ISAs.
Yorkshire Building Society also permits multiple deposits into the ISA until the product is withdrawn from sale.
The account can be managed online so people are able to check their balance, interest rate, and make and view transactions whenever they wish.
Circumstances included under this rule are things such as critical or terminal illness, death, redundancy, nursing home or elderly care costs, divorce or court orders.
Yorkshire Building Society states the closure of the account for a circumstance under the Savings Pledge 2022 will not face a loss of interest penalty.
To open an account, people will need to be over the age of 16 years and a UK resident for tax purposes.
The ISA can be opened online through Yorkshire Building Society’s website or through the post.
Eleanor Williams, finance expert at Moneyfacts.co.uk, said: “Yorkshire Building Society has made some notable rate increases of up to 1.30 percent across its range of fixed rate bonds and ISAs this week.
“Savers yet to use their tax-free savings allowance and who are happy to secure their nest egg away for a specified period may well be enticed by the updated Fixed Rate Cash e-ISA until October 31, 2025.
“Now paying a currently market-leading return of 3.50 percent gross, savers may be further tempted by the fact that earlier access to funds, subject to account closure and a loss of interest penalty, is permitted, and there is also the option to make further additions whilst the issue remains open.
“Overall, this ISA earns an Excellent Moneyfacts product rating.