Whether you are 18 or 80, we all like to put a bit of money aside for a rainy day. Finding an account that pays enough interest to make sure your savings don't devalue is another matter entirely.
An ISA is one of the best ways to put money away without the interest being gobbled up by the taxman. This means your savings are less vulnerable to inflation, which can eat away at your funds over time.
However, as a highly regulated product there are lots of different rules and myriad different ISAs on the market.
If you are looking for a low risk investment, a cash ISA could be the right solution for you. A great way to access tax free savings for over 60s, a cash ISA delivers a guaranteed return with none of the risk associated with stocks and shares ISAs.
We take a look at the best ISAs for over 60s and run through the facts you need to know about this type of account.
How to compare cash ISAs for over 60s
Before you are able to carry out a cash ISAs for over 60s comparison, it's essential to first understand how they work and the rules which apply to the money you put in and take out.
If you are over 60 ISA allowance limits are just the same as anyone else; you have a total ISA allowance but only part of this may be transferred into a cash ISA. The remainder – should you choose to use it – must be ploughed into a stocks and shares ISA, a much riskier type of investment.
The cash ISA allowance for over 60s stands at present at £5760 (although the total ISA allowance including stocks and shares ISAs is £11,520).
All of the money you put into a cash ISA for over 65 counts towards your yearly allowance, no matter how much you take out. This means that if you are up to your maximum investment and then make a withdrawal, you will not be able to replace this money until the next financial year.
Also, you can only pay into a single cash ISA in any one tax year which in turn means you can only open one new account from scratch (although existing ISA transfers into a new account are allowed).
What to look for to find the best cash ISA for over 60s
To compare the best cash ISA rates for over 60s, you'll need to think about what you want to invest and for how long. Both of these factors will play a significant role in selecting the best ISA rates for over 60s.
As a general rule, the longer you can commit to investing the money for, the higher the cash ISA over 60 interest rates will be. This isn't always the case but as a rough guide, instant access or one year ISA accounts don't offer anywhere near the same type of returns as three or five year ISAs.
However, if you can't afford to tie that money up for such a long period then you'll need to adjust your priorities, and your search, accordingly.
Furthermore you shouldn't be fooled by the attention-grabbing initial deposit; although it's true you may be able to open an ISA account with just £1, in order to get the best savings rates for over 60s you will probably need to have a much higher balance. You will also need to maintain this balance in order to continue to qualify for the interest payments.
Finally, wherever you choose to invest your cash, make sure you are protected in case the worst happens. The provider should ideally be a member of the Financial Services Compensation Scheme which means that you will be guaranteed to get your money back if the bank collapses. A cash ISA limit over 60 is no good if you stand to lose all your cash in the event of your bank or building society going under..