First Direct ISA 7.0% AER fixed
Incredible-plod
Posts: 29 Forumite
Hi guys
My wife opened one of these 6 months ago but we had to open a 1st Account to do so and this is still the case.
However we got £100 for doing so and snapped up this 7.0% fixed ISA.
You open it with a balance of £25 - £300 and then pay a minimum of £25 or a max of £300 a month for the next 11 months.
You do forfeit the rate to the tune of nearly 5% if you withdraw (you have to close the account to do so and go onto their instant access eISA) but if things do get tight you can change the regular deposit from £25 to £300 and anything in between in £5 increments and as often as you like.
I have just opened one in my name after finally getting my Icesave money (must be one of the last) and I am surprised the rate is still there.
Interest is calculated daily and paid on the first anniversary. I used Martin savings calculator and my £3250 lump in a best buy at 5% pays less then starting at £300 saving £300 a month at 7%.
£300 x 12 + interest = £4050 (or just short of)
So my money is going in a high (if you can call it that now) rate instant access and £300 transferred to my 1st account just before the debit is due. Win win in my eyes if you can save and don't need instant access. Remember though you can still get it if you need it.
Hope this helps someone.
My wife opened one of these 6 months ago but we had to open a 1st Account to do so and this is still the case.
However we got £100 for doing so and snapped up this 7.0% fixed ISA.
You open it with a balance of £25 - £300 and then pay a minimum of £25 or a max of £300 a month for the next 11 months.
You do forfeit the rate to the tune of nearly 5% if you withdraw (you have to close the account to do so and go onto their instant access eISA) but if things do get tight you can change the regular deposit from £25 to £300 and anything in between in £5 increments and as often as you like.
I have just opened one in my name after finally getting my Icesave money (must be one of the last) and I am surprised the rate is still there.
Interest is calculated daily and paid on the first anniversary. I used Martin savings calculator and my £3250 lump in a best buy at 5% pays less then starting at £300 saving £300 a month at 7%.
£300 x 12 + interest = £4050 (or just short of)
So my money is going in a high (if you can call it that now) rate instant access and £300 transferred to my 1st account just before the debit is due. Win win in my eyes if you can save and don't need instant access. Remember though you can still get it if you need it.
Hope this helps someone.
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Comments
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You won't get £4050 from 12 £300 deposits into a 7% account. You'll get about £136.50 interest on top of your £3600 amount, making a total balance of £3736.50 after a year.
You'll still earn interest on the lump sum outside the ISA too, so you'll need to calculate that if you want a like for like comparison.I am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0 -
And just an observation but if you pay in £300 pm (indeed any amount pm) for 11 months from now you'll have used up some of your next years ISA allowance...
Some would say 'obviously' ...0 -
Not as obvious as you'd think. The fixed rate is only achieved by making 12 consecutive payments - so you are sacrificing next year's ISA when you first sign up unless you timed the application to coincide with the tax year 2008/09 itself (as I have done with mine) For latecomers, the issue is then to transfer the whole amount built up to the end of the fixed rate period ASAP - because the 'go to' rate is now just 2.5%. This should be done possibly after topping up the balance to the full annual allowance for 2009/10 as the accepting account may be one that does not allow additional deposits.And just an observation but if you pay in £300 pm (indeed any amount pm) for 11 months from now you'll have used up some of your next years ISA allowance...
Some would say 'obviously' ........under construction.... COVID is a [discontinued] scam0 -
Bet they pull this before the start of the next tax year just like they pulled the 8% regular saver just before people had the chance to renew.0
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Some time earlier, in fact [Earliest RS maturity was 1 Nov 08]Bet they pull this before the start of the next tax year just like they pulled the 8% regular saver just before people had the chance to renew......under construction.... COVID is a [discontinued] scam0 -
My maths aren't great so I used Martins "what will my savings be worh" calculator.
With an opening balance of £300 then £300 for 12 months gave me the figure above. This is why I opened this account.
How is interest worked out then?
Am I being stupid?
I dont mind being told I am if that is the case.
Regards allowance - Good observation. I only have (alot or a little depending on who you are) £6500 to save anyway so between my wife and I we'll be ok with our own allowances. Thanks though.0 -
From the savings calculator:Incredible-plod wrote: »My maths aren't great so I used Martins "what will my savings be worh" calculator.
With an opening balance of £300 then £300 for 12 months gave me the figure above. This is why I opened this account.
How is interest worked out then?
Am I being stupid?
I dont mind being told I am if that is the case.
Regards allowance - Good observation. I only have (alot or a little depending on who you are) £6500 to save anyway so between my wife and I we'll be ok with our own allowances. Thanks though.After saving £300 a month for 1 year and 0 months,
you will have £3,735.09 in savings.
meaning you've earned £135.09 interest
I think what you might have done is accidentally calculated an additional month and then thought you had the payment from there too...I am a Chartered Financial Planner
Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.0 -
That is exactly what I did!!!
I put in a deposit of £300 and then 12 payments of £300 - Doughnuts for me!
Just as well delete this thread then - Though it is still a good deal. Only £50 short of a 5% rate for comparison but it is fixed and flexible and you'll still get interest on the lump sum while you wait.0
This discussion has been closed.
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