first direct launches savings deal - customers can get £125 cash & 1% interest from today

Ali KhanJun 14, 2021Business

Savers are regularly enticed with new deals and financial experts such as Martin Lewis advise customers to take advantage of them where they can. In light of this, first direct has launched a new deal where it’s offering £125 in cash to new customers opening a first account with the bank.

For June 2021, there are now 1,118 live savings account options available to savers, excluding ISAs.

This is the highest volume seen since January.

For those looking for ISAs, there are 337 deals available.

Moneyfacts noted ISA rates have remained unchanged month-on-on month but the product choice level is at the highest it has been since April 2017.

Neil Jones, a tax and wealth specialist at Canada Life, commented on these statistics and reflected on what may be on the horizon for ISA savers.

He said: “The statistics show that the popularity of ISAs continues to bounce back after the fall in 2016/17 which shows that investors still recognise the benefits available and seek to make use of them.

“It is surprising that cash ISAs account for 75 percent of subscriptions given low interest rates and the expectation that they will remain low. Even though headline CPI is also low the impact of inflation, especially a short-term spike caused by increased spending post-lockdown, could be damaging to cash investors. They could see the value of the investment fall in real terms and this could be more pertinent to the retired community who generally have higher inflation due to the constituent assets in the Government’s inflation figures.

“It is also clear that the wealthy make better use of the full allowance and the tax benefits available. The statement by the Conservative party said they wanted to abolish the tax advantages for the wealthy, so is the maximum ISA limit too high?

“Since the initial allowance of £7,000 was introduced in 1999-00 it has grown to £20,000 which is an annualised increase of over five percent each year compound – not many allowances set by HMRC have increased at a similar rate. The figures released show that the percentage making full use of the ISA allowance correlates to the investors income. ISAs offer valuable benefits to investors and appeal to many who want to save money and do not want to pay income or capital gains tax on the returns.”

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