Cash Isas Transfer discussion

Cacran

I have a mini Cash ISA with Halifax. The interest is not too good, in fact, as I am a non tax payer, it is worse than the ordinary bank account with Halifax. I do not want to withdraw it in case my circumstances change, you never know, do you? The rest of my family have ISA's with NS&I. their rate for their web account is the best. Just say, if I left my other ISA's investent with Halifax, could I start a new one with NS&I with £3,000 this year? I am a bit confused!!!!!

purplestar133

Cacran wrote:

I have a mini Cash ISA with Halifax. The interest is not too good, in fact, as I am a non tax payer, it is worse than the ordinary bank account with Halifax. I do not want to withdraw it in case my circumstances change, you never know, do you? The rest of my family have ISA's with NS&I. their rate for their web account is the best. Just say, if I left my other ISA's investent with Halifax, could I start a new one with NS&I with £3,000 this year? I am a bit confused!!!!!

As far as I know, you can only have one isa at a time. why not transfer your savings to another isa. dont withdraw them, but open a new isa with your new provider, ask for an isa transfer form. your halifax isa will be closed, with your savings transferred to your new isa, and it will be treated as you having one isa, but you just changed providers. i know this can sound confusing i hope i am not confusing things more...have you read martin's article?

Cacran

Thanks for that Purplestar. I will look into doing what you say.

busabus

Hey chaps/chapets.

Just wondering what the consensus is on moving ISA's at the moment? I've got an Abbey Postal Issue 1 that I don't think is doing that great (I'll obviously find out before doing anything). Kent Reliance are offering 5.71%, and allow transfers in. I can't see any mention of a penalty for transferring out again, so I'm thinking perhaps I should shuffle it into there?

And also, what do most people do, transfer as soon as a better deal comes along?

Cheers

hansi

I've just had my maturity letter from Halifax for my 5% fixed rate ISA giving me various options. One is to transfer it into their ISA Saver Direct currently paying 5.30%. However, Kent Reliance paying 5.71% is very interesting but don't know a lot about them. Anyone dealt with them? Also do Halifax charge for transferring Cash Isa's?

orainsear

Cacran wrote:

I have a mini Cash ISA with Halifax. The interest is not too good, in fact, as I am a non tax payer, it is worse than the ordinary bank account with Halifax. I do not want to withdraw it in case my circumstances change, you never know, do you? The rest of my family have ISA's with NS&I. their rate for their web account is the best. Just say, if I left my other ISA's investent with Halifax, could I start a new one with NS&I with £3,000 this year? I am a bit confused!!!!!

There is no limit on the number of mini cash ISA providers that you can set up with.

However what there is a limit on is the amount of funds that you can invest - you can only invest a maximum of £3000 in any tax year, and this can be invested in whichever provider(s) you please.

If you haven't paid anything into your Halifax ISA in the current tax year you can invest it elsewhere, or if you have paid in an amount less than £3000 you can invest the difference elsewhere (both during the same tax year)

Remember that the tax year runs April - April (new year starts 6 April in 2007).

marijke1980

Hi,
I have had a mini cash Isa with HSBC for 2 years now and am thinking of opening one with NS&I in April. They however don't accept transfers in so I was thinking of keeping my HSBC one and when the NS&I rate goes down, I would transfer it all to the HSBC one. How does this work? Do i inform HSBC i won't invest next year? Do i just leave the account open and don't invest in it?
Also, maybe a stupid question but on HSBC i get 4.41% AER paid monthly and on NS&I i would get 5.8% AER paid annually. I always get confused with this AER business. If i only keep the Isa for 1 year, on NS&I i would not have compound interest but on HSBC my interest would be compounded 12 times. Doesn't that mean that in the end HSBC will give me more interest?(as i will get interest on interest) or is my reasoning completely wrong?

Hope anyone can help,
Marijke

orainsear

marijke1980 wrote:

Hi,
I have had a mini cash Isa with HSBC for 2 years now and am thinking of opening one with NS&I in April. They however don't accept transfers in so I was thinking of keeping my HSBC one and when the NS&I rate goes down, I would transfer it all to the HSBC one. How does this work? Do i inform HSBC i won't invest next year? Do i just leave the account open and don't invest in it?
Also, maybe a stupid question but on HSBC i get 4.41% AER paid monthly and on NS&I i would get 5.8% AER paid annually. I always get confused with this AER business. If i only keep the Isa for 1 year, on NS&I i would not have compound interest but on HSBC my interest would be compounded 12 times. Doesn't that mean that in the end HSBC will give me more interest?(as i will get interest on interest) or is my reasoning completely wrong?

Hope anyone can help,
Marijke

Unless your HSBC ISA is set up to automatically be credited with funds then you don't need to do anything. Your HSBC account will remain open if you subscribe to another ISA provider.

The answer to the compounding question is really quite simple - the rates that you have quoted are AER (Annual Equivalent Rate). Any rate that is quoted as AER includes the effect of compounding.

Financial service providers will generally advertise rates as AER so that they can be easily comparable with competitors rates, and from your quoted rates you can see that your HSBC rate is quite a bit lower than the NS&I. In fact I'd be tempted to transfer your HSBC ISA to another provider with a better rate.

BiscuitLily

orainsear wrote:

There is no limit on the number of mini cash ISA providers that you can set up with.

However what there is a limit on is the amount of funds that you can invest - you can only invest a maximum of £3000 in any tax year, and this can be invested in whichever provider(s) you please.

If you haven't paid anything into your Halifax ISA in the current tax year you can invest it elsewhere, or if you have paid in an amount less than £3000 you can invest the difference elsewhere (both during the same tax year)

Is this right? Sorry to question you but it conflicts with other advice I have been given/read.

I currently have £100 in a halifax cash isa, which I have paid £1000 into this financial year. I want to open the A&L isa at 7% (I am happy to open the current account too), but it says that I can't transfer. Whilst I am happy to withdraw my £100 from halifax and close that account, can I open the A&L isa this financial year, and (if it should magically appear) pay in up to £2000 before April 7th? My concern is that the A&L application form asks me to declare that I have not paid into a cash isa this year.

BiscuitLily

Actually, I have answered my own question by phoning A&L. Whilst I can open their 7% Isa now, I can not pay any money into it until next financial year. So I might as well leave my (£100) Halifax isa where it is.