Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Best Cash ISA for Crash / Collapse in UK Savings Interest Rates

Personal_Finance / ISA's Aug 06, 2016 - 07:19 AM GMT

By: Nadeem_Walayat

Personal_Finance

The Bank of England slashing UK interest rate from 0.5% to 0.25% in a panic to save its always teetering on the edge of bankruptcy bankster brethren from going bust again and to monetize government debt by means of quantitative easing, the smoke and mirrors phrase used for the Bank of England to print another £170 billion mostly for its banking sector friends to gorge themselves on, to generate additional artificial profits. The net effect of this 'THEFT' of purchasing power is that the price savers and workers have already been paying for 8 years has just gotten a lot worse!


So where do savers stash their cash in a time when the name of the game is to steal purchasing power of savings. In fact the big banks have begun to announce that they intend on going one step further, which is for outright theft of customer deposits by means of applying a negative interest rate on credit balances! Which means for instance if you have temporarily parked say £400k towards buying a property then at least 1% or £4k of that deposit could be transferred into the coffers of a member of the banking crime syndicate.

More on the game the Bank of England is playing in the following video analysis on the war on cash and what it means for your savings!

https://youtu.be/WGbEpnOqY3w

UK Best Cash ISA - August 2016

This years tax free cash ISA allowance is £15,240. So if you have not already utilised it then here are the current best rates in a world gone mad where savers are punished and borrowers are rewarded.

Firstly, my usual analysis to illustrate the magnitude of the collapse in ISA savings interest rates has hit a brick wall because Halifax have withdrawn virtually all of their fixed rate accounts. However, to continue with this long standing series for when longer duration fixed rates return, I have applied the percentage change on the 1 year fixed rate to fixes for preceding longer duration terms to illustrate what has happened to the UK savings market.

Halifax ISA's May 2012 Sept 2012 Nov 2012 Mar 2013 May 2013 July 2013 Mar 2014 June 2014 Mar 2015 April 2016 Aug 2016 % Cut
Instant Access
3%
2.75%
2.35%
1.75%
1.35% 1.35% 1.5% 1.30% 1.05% 0.60% 0.40% -87%
1 Year Fix
2.25%
2.05%
2.05%
1.75% 1.75% 1.65% 1.5% 1.40%   0.90% -60%
2 Year Fix
4.00%
3.25%
2.25%
2.5%
2.10% 2.10% 2.05% 1.8% 1.65% 1.25% 1.06% -73%
3 Year Fix
4.25%
3.75%
2.35%
3.00%
2.25% 2.25% 2.25% 2% 1.75%   1.125 -73%
4 Year Fix
4.35%
3.80%
2.40%
3.05%
2.30% 2.30% 2.40% 2.10% 1.85%   1.19% -72%
5 Year Fix
4.50%
4.15%
2.60%
3.10%
2.35% 2.35% 2.5% 2.20% 2.00% 2.00% 1.28% -71%

Again note ONLY the 1 year fix is currently available from the Halifax and the table will be updated when longer duration fixes return.

Having trawled many ISA issuers that like the Halifax ALL offer less than 2% for multi-year fixes, the only bank that really stands out is Julian Hodge's 4 year offering fixed at 1.85%! Yes that's a very long time for a sub 2% rate but this is the dire state of Britain's savings market where to get a half way decent rate one needs to fix for FOUR YEARS! Yes I know there are others that pay marginally more such as the Indian banks where the problem is one has to visit a distant branch, for what? an extra £15 per year? And similar holds true for other providers with their obnoxious small prints trying to hide the game they are playing with savers.

  • Easy Access - Coventry Building Society 1.3%, down from 1.4% with probably more cuts to come.
  • 1 Year Fix - Kent Reliance 1.10% cut from 1.45%
  • 2 Year Fix - Leeds BS 1.40%
  • 3 Year Fix - Shawbrook 1.70% down from 2.15%.
  • 4 Year Fix - Julian Hodge Bank 1.85%
  • 5 Year Fix - Shawbrook 1.90% down from 2%

Yes, I know the rates are all pretty rubbish, but what can one do? This is what happens when the Bank of England supports its banking brethren for 8 years with printed money! all backed by Britain's tax payers. The solution of course is to invest in assets that are LEVERAGED to central bank money printing, such as housing and stocks as I have covered extensively in many articles and videos.

So maybe now really is the time to forget about putting any more money into Cash ISA's and focus on investing and perhaps consumption, and not forgetting if your mortgage rate is above 2% then you should pay that down FIRST! Other alternatives are to top up your pension, after all the tax man will give you an instant 20%+. Have Cash ISA savers considered the stock market? Perhaps the time has come to open a stocks and shares ISA, something to ponder as many dividend yields are HIGHER than fixed rate bond rates!

For more post BrExit analysis implications see the following 2 articles -

And my most recent video on UK house prices -

By Nadeem Walayat

http://www.marketoracle.co.uk

Copyright © 2005-2016 Marketoracle.co.uk (Market Oracle Ltd). All rights reserved.

Nadeem Walayat has over 25 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Housing Markets Forecast 2014-2018The Stocks Stealth Bull Market 2013 and Beyond EbookThe Stocks Stealth Bull Market Update 2011 EbookThe Interest Rate Mega-Trend EbookThe Inflation Mega-trend Ebook

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

Nadeem Walayat Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in