skip to main content
Feb 2020

How Can a 1 Year Cash ISA Help Me?

How Can a 1 Year Cash ISA Help Me?

Holding a cash reserve which also maximises your tax-free yearly allowance, is a good idea for any saver. Putting your cash in a 1-year ISA structure gives you flexibility and tax-free interest earnings – with the option of transfer to higher-earning ISA options at the end of your term. 

The end of the tax year is approaching – the clock is ticking on your ability to use your tax allowance for tax year 2019/2020. The use it or lose it nature of the tax allowance means if you are a saver looking to gain interest, you should be looking at opening ISA accounts if you haven’t already.

Cash ISA interest rates are currently very low (below 2%) so at first glance they might not seem like the most attractive option.

But a Cash ISA is still a useful account for at least some of your savings. We’ve broken down a few key reasons why you should consider a Cash ISA.

The interest benefits:

  • Any interest is better a zero-interest current account.
  • The interest rates available from a Cash ISA are better than Easy Access ISAs
  • If you’re already have a Lifetime ISA or a Help to Buy ISA, you can transfer some of your money into a one-year cash ISA, meaning you can have access to that cash in a year.


  • At the end of the term you can take your cash out of the ISA, along with the tax-free interest it’s gained
  • The one-year term gives you more flexibility than offered by a 2 or 3 year term.
  • It gives you the flexibility to move your money after one year if you have not yet decided what your long-term savings goals are. You can still gain interest without locking your money away in the longer-term options like a Lifetime ISA.

Use your tax-free allowance

  • If you have money you want to save and gain interest on, but no specific plan as to how to use it, it’s wise to put it in a Cash ISA before the end of the tax year.
  • With your yearly allowance, it’s use it or lose it – and money in a Cash ISA gaining small amounts of interest is of more value than money in a zero-interest current account.
  • Everyone can invest an additional £20,000 a year in ISAs to get more tax-free earnings.
  • Once you have paid into any kind of ISA you can transfer over to any other kind of ISA in later years without it counting as part of your annual ISA pay-in allowance (currently £20,000).

Cash ISAs might be right for you if you are…

  • Risk averse: you’d rather your money was gaining a smaller amount of interest, but completely safe, than investing it with a higher interest rate but in a riskier account
  • Hands-off: you don’t want to be actively involved in managing your account, but want to know your money is tucked away and gaining interest
  • Thinking short-term: you know you might need the money in the not-too-distant future, so having access to this money in a year’s time is appealing

Our Top Tip: Remember to Switch

  • If you don’t withdraw your money from a 1 Year ISA after the year-long term, the account will most likely revert to a really low rate of interest (or none at all!).
  • Keep track of your ISA accounts and the latest rates to make sure you are getting the best possible deal, then your savings over to a higher-performing ISA as soon as you can do so without penalties.
  • Be sure to get the new fund you’ve selected to transfer your savings over. Don’t cash out of the old account and then pay into a new account or the amount you’re transferring will count as part of your annual ISA pay-in allowance.

Compare the best Fixed Rate Cash ISA rates

High Income ISAs

High income ISA ideas:

ISAs Products

Cash ISAs

Fixed Rate & Instant Access ISAs:

Cash ISAs: 

Stocks & Shares ISAs

Types of Stocks and Shares ISA include: 

Stocks and Shares ISAs

Latest News

5 Considerations for Your Next Investment ISA

15th March 2021

You've decided to invest your savings into a Stocks and Shares ISA. You'll be using your tax-free ISA allowance for this year before the deadline, while also investing your money for your future. But what do you need to consider before opening an account? We've put together a list of our top five considerations for you to think about before you click "apply". 

Newsletter Signup

Sign up to our Newsletter to get exclusive news and offers direct to your inbox.

About us is a trading style of Fair Investment Company.

We've been comparing and recommending ISAs for many years so you can trust you're in good hands.

About us

4.74 Average

23 Reviews


I found the way the different options are presented very clear - much more useful than some other comparison sites. I sent it to my daughter as well.


Very informative, find myself a good ISA account with best return in terms of interest.


Easy to use website and up to date. Saved the link on my tablet.

Rob Holden

The website was very useful and informative.

Andrew Johnson

ISA can be confusing at first and this site includes a useful and helpful introduction into the world of ISAs


Excellent website - clear and helpful information about different products - and a trustworthy partner.


Easy to use website and up to date. Saved the link on my tablet.


Really simple to use and all the information was clear with lots of products available. The interest calculator was really handy too. Have bookmarked and will definitely use again.

Hannah Gordon

This was a really user-friendly site, and was very helpful when it came to comparing accounts and choosing my 2016 ISA.


Easy to use website and up to date. Saved the link on my tablet.


If you wish to invest in an ISA this site has it all. A super comprehensive range of simply explained products from all the major companies.

Cristina Iacob

Very knowledgeble company with an extensive range of services, a great website with loads of useful information.


Nice graphics and easy to navigate

Dr Alan Rogan BSc PhD FCIOB FCABE Eur Ing

Good advice and professional approach


Very helpful for getting my annual ISA

Jonny Doulton

Clear, concise and very professional outfit with an excellent choice of market leading deals.

Paul Tissington not only helped narrow down my choices for a Junior ISA but also provided additional practical information that helped demystify the whole process.

Sunil Karadia

Just the site I needed, I have been looking for a suitable ISA for a while, but as there are so many to choose from, find it difficult to find the right one for me.

James Weatheritt

I found the information on very helpful and easy to understand. The site is easy to navigate and find what you're looking for.

Lisa Holden

I found very insightful and easy to navigate through. The content was useful and helped me make my ISA decision.

Neta Pourhosseini

I thought the information provided was easy to understand and very informative, I would recommend to friends for deffinite.