Just one in 25 fixed-rate ISAs can give a return that beats the current two per cent inflation rate
- Even the best two-year fixed rate ISAs offer just 1.9 per cent interest rates
- It is only in a three-year fix the rate creeps up to at most 2.05 per cent
- A year ago savers would have has to choose a four-year bond to beat inflation
Published: 20:59 EDT, 21 July 2019 | Updated: 21:00 EDT, 21 July 2019
Only one in 25 fixed-rate ISAs can beat the current 2 per cent rate of inflation, it emerged yesterday.
Even the best two-year fixed rate ISAs offer just 1.9 per cent interest.
It is only in a three-year fix that the rate of return creeps up to 2.05 per cent. A year ago savers would have had to choose a four-year bond to beat the then inflation consumer prices index rate of 2.4 per cent.
The figures, from Money Facts, do show that yields on fixed rate bonds have held up better, with one-year fixed rate offers beating inflation.
It is only in a three-year fix that the rate of return creeps up to 2.05 per cent. A year ago savers would have had to choose a four-year bond to beat the then inflation consumer prices index rate of 2.4 per cent (file image)
Rachel Springall, finance expert, said: ‘In the fixed ISA market only 4 per cent of deals can beat inflation.
‘This month, savers would need to lock into a three-year fixed rate ISA to beat inflation, but they could instead find a one-year fixed rate bond that would also pay above 2 per cent.
‘In real terms, many savers will be losing out unless they choose the top rates in the market.’
Savers have missed out on £188billion of interest on their nest eggs in a lost decade since the financial crisis.
Savers have missed out on £188billion of interest on their nest eggs in a lost decade since the financial crisis (file image)
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