Choosing the right cash ISA

A quick overview

There are two types of Principality Cash ISA to choose from: Fixed Rate and Variable Rate. The right option for you depends on whether you want to lock your money away at a fixed rate or have more flexibility over paying in and accessing your savings.

Transcript

When you open a Principality Cash ISA, you can choose from two interest rate options. 

Fixed Rate Cash ISA

With a Fixed Rate Cash ISA, you have a short window of time to add money to your account. And once that passes, you can't pay any more money in.

Your interest rate will be fixed. It’s locked in for a set period, like one, three, or five years.

And during that time you can’t withdraw any of your money.

The idea is you pay in a lump sum over quite a short space of time. Then leave that money untouched, earning interest, until your account matures.

Variable Rate Cash ISA

With a Variable Rate Cash ISA you can pay money in at any time. There’s no fixed window, you can add money little-and-often, building it up over time.

And if you want to access your money, a Variable Rate Cash ISA might let you make unlimited withdrawals. Or may might give you the option to make a set number of withdrawals a year.

The interest rate itself is variable. So the amount of interest your savings is earning can change over time.

Before you choose a Cash ISA ask yourself these three questions

1. Am I happy to lock my money away without being able to withdraw it? Or would I prefer the option to access my money?

2. Do I want to know exactly what my interest rate is going to be? Or am I comfortable with the idea of the interest rate moving and changing as the base rate does?

3.  Do I want to save in one lump sum or keep adding money over time? If your goal is to use as much of your ISA allowance as possible, but you don’t all the money available today, an account that lets you keep paying in could help you achieve that goal.

If you want to learn more about your ISA allowance, you’ll find more videos and guides on our website.

Asking yourself these questions can help you choose a Cash ISA that suits you.

Return to how to choose a cash ISA

Want to learn more?

Understand more about ISAs