New top Cash ISA

Yorkshire Building Society has launched a market-leading one-year fixed rate Cash ISA paying 2% AER.

The account is available to open with a deposit of £100 and will allow transfers in from other providers.

Interest can be paid monthly or annually.

Savers wanting to open an account can do so in a branch, via third party agencies or by post, but not online.

However, the 2% rate is also available from other brands from the YBS Group, including Barnsley, Chelsea, and Norwich and Peterborough building societies.

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Don’t delay

This is a limited issue product, which means it can be withdrawn without notice at any time.

So if you’re interested you should act fast before it disappears.

The next best rate on a one-year fixed rate Cash ISA is 1.65% available from Aldermore and Tesco Bank.

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Short-term vs. long-term deals

In general the longer you are prepared to lock up your cash the better the return.

At the moment the top three-, four- and five-year fixed rate Cash ISAs pay between 2.45% and 2.85%.

But investing in these types of accounts is a gamble as you may find your savings trapped in an uncompetitive deal a couple of years in, should rates on saving accounts start to rise.

And this is looking more and more likely.

There have been strong indications the Base Rate will start to creep up from the beginning of next year. Once this happens, saving rates will follow.

So short-term fixed rate or even instant access ISAs could be a safer bet for your money.

The best short-term ISAs

Here are the top short-term and instant access ISA deals available right now.

ISA	Term	AER	Minimum deposit
Cheshire Building Society Fixed Rate Cash ISA	Two years	2.05%	£100
Yorkshire Building Society ISA	One year	2.00%	£1,000
Coventry BS Branch E-ISA	Instant access	2.00%	£1

[Compare savings rates]