Lloyds TSB has a new Cash Isa Saver – Base Rate Tracker which keeps pace with base rate changes.
The new Cash Isa is set to compliment the Lloyds TSB Tracker Bond which was launched earlier in the year.
The new savings account has interest of 2.35% AER/Tax Free (tracks 1.85% over the Bank of England base rate for 12 months*)
The minimum balance is just £1 and the maximum £5,340, the Cash ISA limit for this tax year and the account is available to both new and existing Lloyds TSB customers with transfers in also allowed.
Greg Coughlan, Head of Savings at Lloyds TSB said “We understand savers are eager to get the most out of their savings but are uncertain what to do with the continued speculation that interest rates will change.
“Taking these concerns on board, we have designed Cash ISA Saver – Base Rate Tracker which allows customers to make the most out of their savings with tax free interest earnings and an interest rate that keeps pace with base rate changes.”
MoneyHighStreet comments: “A base rate linked savings product sounds like a great idea, however, with the base rate predicted to stay low for some time are there alternative options to also consider?
“For example, Birmingham Midshires offer inflation linked ISAs which are designed to prevent your money being worn away as inflation rises.
“If you’re looking to invest your money for a year, there are options available too that may be attractive, including the ING Direct Cash ISA currently offering a guaranteed rate of 3%.
“You of course need to make your own decisions as to what’s best to meet your own specific needs.
“Whatever you opt for, make sure you keep an eye on the interest being paid and ensure you continue to get the best deal – it’s all too easy to almost forget your savings accounts thinking they are continuing to earn a good rate of return when in fact initial bonus payments may have been paid and your account may be languishing on a poor interest rate.”
* Rates on the Cash Isa Saver – Base Rate Tracker will change on the 1st working day of the month following a change in the Bank of England base rate. Account reverts to the variable Cash ISA Saver currently paying 1%