Cash ISAs earning pennies on thousands-papers

Cash ISA savers are receiving 40 times less interest compared to those in similar taxed accounts.

Some ISAs are earning customers pennies in interest on thousands of pounds of savings, according to The Daily Mail.

In April 1999 when tax-free cash ISAs were launched, they were the top-paying accounts at every bank.

But in a stark reversal in some cases today they are the worst, with banks sitting on a large pot of funds on which they pay little interest.

More than 18 million savers have £167m in cash ISAs .

In April 1999, cash Isas earned an average 6.32pc - 1.07 percentage points above base rate. Now the average is 0.41 pc - 0.09 points below base rate.

Tax relief was worth £13 a year on every £1,000 saved for a basic-rate taxpayer. Now it is worth just 82p. Read more

VIRGIN MONEY is in talks with Sir Brian Pitman, the veteran retail banker and former chairman of Lloyds TSB, on steering the company.

Virgin Money is currently seeking to expand its operations with a position on the high street, the Times reports.

Earlier this month, it bought the Somerset-based Church House Trust in a £12.3m deal, with confirmation this morning all conditions to the offer had been accepted.

It has emerged Sir Brian is among a "handful" of people being courted for the post.
Sir Brian, 78, has a close relationship with the company and led the company's takeover bid for Northern Rock two years ago.

Virgin Money is refusing to confirm speculation Sir Brian would become chairman of the newly expanded company.

A spokesman for Virgin Money, says: "We have been talking to Sir Brian, we have a good relationship with him and he worked with the business over Northern Rock, but we have not yet confirmed any non-executive positions or the position of the chairman." Read more

NEARLY A FIFTH of 2010 retirees admit they will be relying on the state pension and income from savings to fund their retirement, according to insurer Prudential.

Nearly a third of people who are about to retire have no idea how much state pension they will receive or overestimate how much they will get by £25 a week or more, according to the Telegraph.

Prudential warned people planning to rely solely on the state are likely to be in for a shock, as the basic state pension currently pays £95.25 a week to a single person and £152.30 to a married couple.

But the latest figures from the Office for National Statistics (ONS) show the average expenditure for a household headed by someone aged between 65 and 74 is £321 a week.

Martyn Bogira, director of defined contribution solutions at Prudential, says: "If the basic state pension is your only source of income you could be in an extremely precarious position financially.

"Just one significant financial emergency, like your central heating system unexpectedly breaking down, could cause serious financial hardship for people expecting to retire on the state pension alone." Read more