Yahoo Finance Best fixed-rate cash Isas in 2018: our favourite accounts
The average rates of fixed-term savings accounts continued to creep upwards in May and June, with new account launches from challenger banks.
Longer term fixed-rate Isas now pay 2.3pc compared to just 1.15pc in April last year.
Towards the end of May, Chartered Savings Bank announced a number of new rate rises, and now pays 1.52pc on a one-ear fixed-rate Isa.
Locking your money into a one, two or three-year fixed-rate Isa could be a good idea if you're certain you won't need to touch the money during the period.
Non-Isa fixed-rate savings bonds typically pay more, but if you're an additional-rate taxpayer, and therefore do not get a personal savings allowance, Isas may be your first choice for tax-free savings.
If you're uncomfortable with tying up funds for the long term, you may want to consider a variable-rate Isa or easy-access savings account.
In this article, we have focused on the best fixed-rate Isas currently on offer.
Reader Service: Choose the best fixed-rate cash ISA for you with Telegraph Money Comparison Service
The best fixed-rate cash Isa deals
Isas allow people to save thousands of pounds tax-free every year. The maximum cash Isa amount for this tax year is £20,000.
Fixed-rate Isas mean that savers cannot access their money during the fixed term. If they do they will face the penalty of lost interest.
ONE YEAR
Charter Savings Bank pays a top rate of 1.52pc.
Customers can open the online account with £1,000.
Those who need to access their cash before the end of the term will lose 150 days' interest.
Old Isas can be transferred into the account meaning, which can only be operated online.
Kent reliance pays a slightly lower rate of 1.48pc, but you can operate your account online, in a branch or by post.
TWO YEARS
Shawbrook offers the market leading two-year Isa with a rate of 1.7pc.
Customers will need a minimum of £5000 to open an account and cannot split their allowance between different ISAs with the same provider.
Charter Savings offers a marginally lower rate of 1.69pc, and allows you to split money in a cash or investment ISA.
THREE YEARS
Aldermore's three-year Isa pays 1.80pc on balances starting at £1,000.
Accounts can only be opened online.
Withdrawals are subject to 180 days' loss of interest. Transfers in are allowed from up to 10 different providers.
FIVE YEARS
Shawbrook Bank pays 2.3pc over five years and you will need £5000 to open an account, and early withdrawals will cost you 360 in lost interest.
The next best rate is with United Bank UK, which pays 2.12pc.
