Principality over 50s ISA paying 3.80%

Principality Building Society has launched a fixed-rate ISA paying 3.80% AER until June 2012, specifically designed for savers over the age of 50, who are looking to make the most of the new higher tax-free savings allowances.

The new ISA launches on 21 September and is available to anyone currently aged 50 or who will turn 50 before the end of the current ISA year on 5 April 2010. Savers opening Principality's over 50s ISA will initially be able to invest the current limit of £3,600. When the higher limit is introduced on 6 October, savers will be able to top-up their ISA by £1,500, maximising their full £5,100 tax-free allowance. The top-up will have to be made by the end of October.

Principality's ISA allows transfers in, making it ideal for savers who have their savings with providers that will not be accepting additional top-ups under the higher ISA limits for over 50s. With a fixed rate of 3.80% AER offering a guaranteed return, it is also a great deal for savers that have not yet opened an ISA or who are looking to move their cash from an instant access account to a fixed account in order to benefit from a great return.

James Wright, Marketing Director of Principality Building Society, explains: "Over 50s savers have a great opportunity to maximise their investments with the launch of the higher ISA limits, so Principality's new ISA has been designed to help them make the most of that opportunity as well as giving them a guaranteed return at a great rate.

"Our systems are in place to allow top-ups from 6 October and this new product allows transfers in, inviting savers that are with providers that do not allow top-ups this October. ISAs have always been a must-have for every saver, but in the current climate they make more sense than ever before. We know that some savers are unclear about the new limits for over 50s, so at Principality we are happy to help people understand the rules and make the most of their ISA options."

According to data from Mintel savers over the age of 50 are more likely than any other age group to have a cash ISA, but data from April 2009 revealed that just over 50% of the over 50s still do not have an ISA.

In addition to the new ISA, savers aged 50 and over before 5 April 2010 will be able to top-up their Principality ISAs - or take out a new ISA - in line with the new £5,100 limit when it is introduced on 6th October. The full line-up includes:

Fixed Rate ISAs
Savers with a Principality fixed-rate ISA will be able to top up their account with one lump sum of up to £1,500. This includes:

Two year fixed-rate ISA paying 3.50% AER (does not allow transfers in)
Two year fixed-rate ISA paying 3.25% AER (allows transfers in)
One year fixed ISA paying 3.20% AER (allows transfers in)
Three year fixed-rate direct ISA paying 4.20% AER (allows transfers in)

The top-up must be made by the end of October. New savers aged over 50 will be able to invest their full £5,100 limit.

Easy Access ISAs
Savers currently aged over 50 or who will be 50 before 5 April 2010 will be able to top up their ISA at any time, so long as the total £5,100 limit is not exceeded. For savers that have already invested their current £3,600 limit, they will be able to top up any amount at any time up to £1,500. Principality easy access ISAs include:

E-ISA paying 1.80% AER
Variable Rate ISA currently paying 0.60% AER

Regular Saver ISA
Customers with Principality's Regular Saver ISA can increase their monthly payments up to £550 from October to benefit from the new tax-free allowance. In addition, the Regular Saver ISA already allows savers to top-up to the full allowance between 1 March and 5 April 2010, so now they will be able to top-up to the new limit of £5,100. The Regular Saver ISA is no longer available to new customers.

Further information is available online at principality.co.uk.