Fixed Term ISA

Compare Fixed Term ISAs

Fixed term ISAs offer a fixed rate of interest on your tax-efficient savings, usually for periods of 1-5 years. Usually, longer fixed terms mean higher interest rates, so fixed term ISAs can really help you to make the most of your ISA allowance. Use the comparison tables below to compare our wide range fixed rate ISAs from leading providers. Or for potentially higher returns, you could consider our selection of cash ISA alternatives.

How does a fixed term ISA work?

Fixed term ISAs offer a fixed rate of interest on your tax-efficient savings, usually for periods of 1-5 years. Traditionally longer fixed terms meant higher interest rates, although this isn't always the case in today's financial climate, so you may wish to consider alternatives to fixed rate ISAs. Fixed term ISA’s also usually offer a fixed rate of interest, rather than a variable one. So no matter what happens to the financial climate over the course of your ISA the rate of interest you receive will stay the same.

Advantages of a fixed term ISA:

Fixed term ISAs offer a longer-term way to save money without risking capital on the stock market, so they can be good for the more cautious saver.

As well as the possibility of a good rate of return over the long term, fixed term ISAs can be a useful way to save for a specific future event. Knowing that you'll be penalised for early withdrawal from a fixed term ISA might make you think twice before using the cash for something else.

You also can work out exactly how much money you will get out of the ISA from the outset as the rate will always be the same.

Disadvantages of a fixed term ISA:

Fixed term accounts don't necessarily beat the highest rates on offer from more accessible cash ISAs. It's essential to research providers thoroughly before you commit, rather than assuming that a fixed term ISA will automatically guarantee a superior rate.

Some accounts will prevent you from being able to make withdrawals during the ISA term, others may permit withdrawals but subject them to penalty of a certain amount of days worth of interest, this means you could get back less than you put in.

Unlike instant access ISAs, fixed term ISAs mean that you run the risk of being unable to switch to a provider with preferable interest, at least until you've sat out the fixed term. So, you could find that the attractive fixed rate you started out with begins to look increasingly uncompetitive in comparison with subsequent instant access cash ISA rates.

You can use the comparison tables above to compare our wide range of the best fixed term ISAs from leading providers. Or for potentially higher returns, you could consider our selection of cash ISA alternatives, whether you are thinking of opening just one kind of ISA, or breaking up your allowance to open one of each, shopping around to compare providers can be a good idea to find the products that fits your specific needs best.