Cash ISA Discussion/Question

t_i_g_e_rr

I have a good amount of money in my ISA and I want to transfer it to a better rate for the next 3 years. The best fixed-rate I have found is 5.1% with Julian Hodge Bank, with an early withdrawal penalty. Marks and Spencer's variable rate is at 4.5% with the promise that it will be at least 0.5% above base rate for at least the next year, although I don't mind moving every so often to get the best rate.

I have calculated (hopefully correctly) that if the base rate rises by 0.5% to 4.5% in the next year and 0.5% to 5% the year after, that a variable rate account will perform almost the same as the fixed rate (this assumes 4.5% yr1, 5% yr2, 5.5% yr3).

I therefore have two questions. If anyone knows the answers I would be very happy.

The amount I have to pay for the early withdrawal is unclear in the T+C's. Does anyone have any ideas? Does anyone have an account with Julian Hodge Bank?
Are there any economists out there who know what the current thinking on what interest rates will do in the next 3 years is (I won't hold you to any predictions)?

Many Thanks
T_i_g_e_rr

System

Sorry, This has probably been asked before but I'm still a bit confused!

In year 1 i invest £3000 and get, for arguments sake, £100 tax free interest.

In year 2 i invest another £3000. Do I get interest free savings on all £6100 or is the interest on the first £3100 taxed, giving tax free only on the additional £3000??

Cheers

alexei_2

Tax free interest on the whole amount whilst it remains in ISA's.

System

hi there,
If you invest in an ISA in tax year 2003-2004 but do not invest the full £3000 can you invest in this ISA after April 5th and still gain the tax free benefits.

i.e. could I open an ISA before April 5th with £1 and then after April 5th invest another £2999

isasmurf

You get £3,000 per year. If you do not use it you lose it.

If you open an ISA with £1 this year, you cannot invest the other £2,999 the following year. However, you get another £3,000 allowance which you can invest in the same ISA if you so wish or a different ISA.

System

Does anyone know why there is a credit check to open a mini cash ISA savings account?


I was looking to open one with IF (intelligent finance), via IF.com, but reading through the terms and conditions they do a credit check and credit scoring on all applicants.


Why is that? I just want to open an ISA cash savings account with them, not interested in loans, mortgages, etc.


I understand about verification of identity, but this does seem a bit strange.


Cheers,


Danny.

salmac_2

I hate to be negative but I wouldn't touch IF with a bargepole. I applied and sent funds for this year's Mini Cash ISA in the first week in January, IF didn't clear my funds until AFTER the Interest application date so that I lost out on high interest from my savings account when I withdrew the cash for the ISA and I still to date have not received any interest on my new ISA with IF. I also asked them to transfer my Current Account at the same time and this is STILL with my old bank!! Don't be taken in by their high interest promises, words are cheap!!

lisyloo

I would agree that IF service is terrible.

I used to have a mortgage with them and I have recently changed partly because their service was awful.

I have kept my savings account with them merely for convienience.

I recently applied for a TOISA with them.
I have recently sent them a complaint along the following lines.

1) Their application system does not allow you to disntiguish between transferring a TESSA and transferring a TOISA.
I have therefore been asked for a TESSA maturity certificate (which is not needed for transferring a TOISA).

2) I did not automatically receive their letter of intent, I had to ask for it.
The first one I never received.
The second time I asked I got a form for a mini cash ISA.
The third time I got it.

I have had quite a few experiences with them and they are pretty awful.
I am only with them for 2 reasons - they have some great rates and the convienience of not shutting the account and re-opening another one elsewhere.

lisyloo

I meant "letter of authority" to the other building society to transfer the TOISA.

Darryl

I just want to state that I have never had a problem with the IF.com cash ISA. Setting up the account was easy, and transferring cash into the account is done via direct debit, and has never been a problem for me.

Salmac - if you had a problem transferring money into the account, why don't you claim under the direct debit guarantee? This will definitely provide you with some form of compensation.

For me, the IF ISA with it's interest rate guarantee until 2005 can't be beaten (yet). And their service is fine.

Just my opinion mind, based on my experience.

Darryl.