Should I go for short or long term fixed-rate ISAs?
This will depend on your personal circumstances and how long you’re willing to lock your money away for. A short-term fixed-rate ISA could be an ideal way to dip your toe in the water and earn a higher rate of interest over the short term than an easy access ISA. That said, if you know for sure that you won’t need the money for a while, you could get a better return if you lock away your funds for longer.
There is another variable, however. The interest rate is at its lowest for decades right now and that could change. If it does and the interest rate increases, then your funds will still be locked up at the rate you agreed to when you took out the ISA, and you won’t be able to move it to a higher rate account unless you pay a penalty, so it’s always best to check your account restrictions. Given the possibility that this could happen, a short term fixed rate ISA that matures in one or two years might be the better option.
If you’re in any doubt you should take expert financial advice. Just be aware that every financial decision carries an element of risk and even the world’s finest economists cannot see what is round the corner so only lock away money you’re sure you can live without.