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Best 5 year and longer fixed rate ISAs

Savers who are willing to lock their money away for a longer period could consider a five-year fixed rate ISA. While they may pay lower rates than shorter-term ISAs, the rate is guaranteed for five years which can be appealing to savers unsure about the direction of interest rates in the future.

See our charts below to compare the best five-year fixed rate cash ISAs.

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Best ISA Rates - 5 Year Fixed

We found 31 PRODUCTS in total, of which 3 are EASY TO OPEN

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  • Shawbrook Bank 5 Year Fixed Rate Cash ISA Bond Issue 53
    AER
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    4.23%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
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    Anniversary
    Further Options ˅
    Go To Provider's Site
    AER
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    4.23%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
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    Monthly
    Go To Provider's Site
  • UBL UK 5 Year Fixed Rate Cash ISA
    AER
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    4.23%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
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    On Maturity
    Further Options ˅
    Go To Provider's Site
    AER
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    4.23%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
    Press for help tip
    Anniversary
    Go To Provider's Site
    AER
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    4.23%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
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    Quarterly
    Go To Provider's Site
    AER
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    4.23%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
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    Monthly
    Go To Provider's Site
  • Paragon Bank 5 Year Fixed Rate Cash ISA
    AER
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    3.90%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
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    Anniversary
    Further Options ˅
    Go To Provider's Site
    AER
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    3.90%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
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    Monthly
    Go To Provider's Site
  • Hampshire Trust Bank 5 Year Online ISA Fixed Saver (Issue 2)
    AER
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    3.75%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
    Press for help tip
    Anniversary
    Go To Provider's Site
  • Hinckley & Rugby BS 5 Year Fixed Rate Cash ISA - Issue 10
    AER
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    4.25%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
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    Yearly
  • Close Brothers Savings 5 Year Fixed Rate Cash ISA
    AER
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    4.23%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
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    Yearly
  • Hodge Bank 5 Year Fixed Rate Cash ISA
    AER
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    4.22%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
    Press for help tip
    Anniversary
    Further Options ˅
    AER
    Press for help tip
    4.22%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
    Press for help tip
    Monthly
  • United Trust Bank Cash ISA 5 Year Bond
    AER
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    4.20%
    Account Type
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    Cash ISA
    Term
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    5 Year Bond
    Interest Paid
    Press for help tip
    Anniversary
  • Nottingham BS 5 Year Fixed Rate Cash ISA 215
    AER
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    4.11%
    Account Type
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    Cash ISA
    Term
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    31.03.30
    Interest Paid
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    Yearly
  • Nottingham BS 5 Year Fixed Rate Cash ISA 9
    AER
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    4.11%
    Account Type
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    Cash ISA
    Term
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    31.03.30
    Interest Paid
    Press for help tip
    Yearly
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Disclaimer

All rates subject to change without notice. Please check all rates and terms before investing or borrowing.

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Five-year fixed rate cash ISAs explained

Five-year fixed rate ISAs are an option for savers who have a lump sum of money that they know they won’t need to access for at least five years.

The interest rate won’t change during the five-year term, and, in return, you won’t be able to withdraw any money from your account (or transfer to another ISA) without incurring a penalty.

Because it’s a big commitment to lock your money away for this length of time, it’s important to think carefully about how much you deposit. This is particularly significant if the provider only allows you to make one deposit upon opening the account with no option to make further contributions.

When the five-year term is about to end, the ISA provider should contact you with some next steps. If you do nothing and don’t give any alternative instructions, the provider is likely to move your money into a standard variable ISA once the fixed term ends.

As with any ISA, you don’t pay tax on any interest you earn. Bear in mind that your ISA allowance means you can deposit up to £20,000 in total across one or more ISAs each tax-year. The tax benefits of ISAs depend on your personal circumstances and may change i n the future.

Pros and cons of five-year ISAs

  • The rate won’t change during the five-year term, which means the return on your money is guaranteed.
  • If rates fall, you could be better off than if you locked into a shorter-term ISA.
  • You won’t pay tax on the interest you earn.
  • You won’t be able to withdraw money from your ISA or transfer to a new ISA provider without some form of penalty.
  • If interest rates rise, your money could be locked into an account paying a relatively low rate.
  • The maximum you can deposit in ISAs each tax-year is £20,000.

Should I consider fixing for a shorter term?

It’s impossible to know what the future holds so, if you suffer a financial shock such as losing your main source of income or needing to pay a major unexpected expense, having all your savings tied up in a long-term fixed ISA may not be ideal.

This is why it’s important to not lock all your savings away in a five-year ISA, and instead put aside some of your money in an easy access account that you can use in an emergency.

But, if you have sufficient money in savings that you can draw on at short notice, it’s up to you to decide whether you put any additional money in an ISA with a shorter or longer fixed term.

A shorter-term ISA may be more suitable if you think you’ll need to use your money in the near future, or if you’re not comfortable locking away access for as long as five years.

However, if you’re confident that you can lock away and forget about a sum of money for five-years, it may be worth considering a longer-term ISA.

For many people, it may be a good idea to consider splitting your money across easy access, short-term and long-term ISAs to cover all eventualities.

Alternatives to five-year ISAs

If a five-year ISA is slightly too long to lock away access to your money, you could consider a four-year ISA or a three-year ISA.

Or, for an even shorter-term, one-year ISAs and two-year ISAs are popular options among savers as they can pay competitive rates of interest.

If you want an account that allows you to access your savings when needed, you could consider an easy access ISA or a notice ISA.

Alternatively, instead of an ISA, you could also look at a standard savings account. There are easy access accounts, notice accounts and fixed rate bonds to choose from, but it’s worth noting that you would need to pay tax on any interest you earn above your Personal Savings Allowance (PSA).

By contrast, any interest you earn on money deposited in an ISA is exempt from tax.

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Rhiannon Philps

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