Instant access cash ISA bonus rates are on the rise, putting savers at risk of losing out once bonuses expire, warns Investec Save.
Analysis carried out by Moneycomms for Investec Save, found that five of the top 10 paying instant access cash ISAs rely on bonus rates, rising to nine out of the top 25 and 12 out of the top 50.
Average bonus rates are 1.68% over 12 months, but range from 0.49% to 3.16%. In total, 14 of the 165 instant access cash ISAs on the market include bonuses.
However, Investec Save’s research found that once bonus rates expire the instant access cash ISAs are much less attractive, with just two ranking in the top 50.
David Hunt, head of deposits at Investec, said: “Bonus rates seem attractive on instant access cash ISAs but the reality is that many savers leave money in accounts when these expire. That could mean losing out as the analysis shows rates on accounts with bonuses drop significantly once the bonus is gone.”
Andrew Hagger of Moneycomms, added: “The use of bonus rates in the cash ISA market is quite commonplace but there is a big downside for consumers who forget to switch.
“If you don’t remember to move your money upon bonus expiry your cash could be earning as little as 1% in some cases.”
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