How Do Cash Isas Work?

The most straightforward cash ISAs are easy access and pay variable rates of interest. In other words, you can get at your money when you want but the interest rate could go up or down. Some ISAs pay a fixed rate for a set term, rather like a savings bond. For example, an ISA might pay 2% fixed for three years.

Is it worth having a cash ISA?

If you won't pay tax on savings interest, a cash ISA may still be worth it. You should consider it if: Rates are higher on cash ISAs than normal savings. You may need access to your cash.

Can you lose money in a cash ISA?

Your money is secure in a cash ISA: you're not going to lose it, though its value may be eroded if the interest you receive is less than the rate of inflation. ... Cash ISAs provided by all banks, building societies and major financial institutions are covered by the FSCS.