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A reader seeks advice on their **cash ISA rates** after experiencing a decrease. They opened a cash ISA with Trading 212 in October 2024, initially attracted by a 5.1 percent interest rate. However, the rate has since decreased to 4.35 percent. Although they received notifications about the changes, the gradual decline went largely unnoticed. The provider now offers a 4.83 percent rate, but this is exclusively a bonus for new customers. The reader values the usability and quick withdrawal/deposit features of Trading 212, and seeks insight as to whether it is time to seek a higher interest **ISA account**.
Evaluating Your Cash ISA Options
Helen Kirrane from This is Money addresses the reader’s concerns:
In recent months, **cash ISA** providers have engaged in competitive rate offerings, often incorporating short-term bonuses to attract new customers and climb the best-buy charts. While the competition isn’t as fierce as in previous months, some options still stand out. However, the reader’s current provider’s rate has decreased, in contrast to the bonus rates for new customers.
Factors Influencing ISA Rates
Savers with funds in easy-access accounts and ISAs face risks of rate reductions, particularly after the Bank of England’s recent base rate adjustment to 4.25 percent. Many top-tier **cash savings accounts** come with particular terms like withdrawal restrictions or a considerable bonus rate that phases out.
- Withdrawal Restrictions: Some accounts penalize frequent withdrawals.
- Bonus Rates: Attractive rates may drop significantly after an introductory period.
Current ISA Alternatives
Consider these alternatives, depending on the features you prioritize:
Moneybox Cash ISA
Moneybox offers a rate of 5.71 percent, which includes a 1.51 percent bonus for three months. It restricts withdrawals to three times within 12 months; exceeding this limit reduces the rate to 0.75 percent.
CMC Invest Easy-Access ISA
CMC Invest’s easy-access ISA* presents a potentially suitable alternative, particularly if you’re comfortable with a rate adjustment post-bonus period. It features a 5.7% rate which includes a 0.85% bonus for the initial three months, after which the rate stabilizes at 4.85 percent. Key advantages include:
- Flexibility: Unlimited withdrawals without penalty.
Tembo Easy-Access ISA
If flexibility is not a primary concern, Tembo’s easy-access ISA pays 4.81 percent.
Trading 212’s Current Standing
Per Moneyfacts Compare, the average easy-access ISA currently offers 3.01 percent. Trading 212’s rate of 4.35 percent is notably higher with flexibility and unlimited withdrawals. There is no guarantee that any provider will not alter its ISA products.
Expert Opinion
Andrew Hagger, founder of MoneyComms, notes: Savings and ISA rates are projected to decrease throughout 2025. Although the reader’s rate has decreased, the 4.35 percent is still competitive, especially with the flexible ISA feature. If this flexibility is essential, staying with Trading 212 may be the best option. If not, consider Plum or Tembo for potentially higher rates.
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