New ISA Allowance

Mikeyorks

BruceyBonus wrote: »

So over 50s are gaining an extra £3000 allowance this year - which the rest of us will never see. It isn't simply a 6 month advantage.

No word of consolation for the under 16's then?

And is the age based personal allowance (65+ and again at 75+) discriminatory ..... or just basic and sensible pragmatism? And the retirement age for pensions etc etc etc.

I think that 'unlawful' / 'discriminatory' and 'inappropriate' .... need to be banned on forums!

Off for a coffeee ..... and I'll feel better.;)

Lokolo

Mikeyorks I think what you are saying is completely inappropriate and discrimitory against those that feel left out in all of this and that they feel as those this is unlawful

Mwahaha, that took me ages to think of something lol.

Jonbvn

cyclonebri1 wrote: »

Yes I value the tax position by keeping money here BUT, the banks are taking advantage of the advice being given to always go cash isa 1st by shafting us

As my previous post said, they key is the net savings rate you obtain vs. inflation. This hasn't changed much over the last 6 months.

Anyway, I agree that the banks are shafting us. That is what banks do and is the raison d'etre for MSE.

adambro

Paul_Herring wrote: »

ITYM £1.5K cash allowance. And it's not that much if you're saving for the long term, and if you're not, then ISA's aren't that much of a great deal at the moment.

As I said, mountains/molehills.

Not really sure what you're saying. Yes the increase will mean you could choose to save £1.5k more in a cash ISA but if you don't save any in cash and opt for stocks and shares then you'll be getting a £3k bigger allowance.

As has been noted, under 50s won't be on equal terms come 6th April 2010. They'll have missed out on this additional allowance. It doesn't really matter whether over 50s get an increased allowance five months, five weeks, or five days earlier, it is still a £3000 difference which I would consider to be quite significant.

Attempts have been made by some on the forum to try to quantify it in terms of interest lost or whatever but there are too many variables. If you don't just stick it in a cash ISA earning crap interest and invest it then your return could be much more significant than the £5 or so some have ridiculously suggested and of course the money can still be sat in your cash ISA when interest rates climb upwards as they inevitably will. I'd therefore suggest that any claims that giving this allowance earler to over 50s is insiginificant are without merit.

Is it discrimination? Well of course it is but that certainly doesn't make it unlawful. Government can and should be able to introduce legislation which only applies to individuals of a certain age so I have no problem with age being a factor in issues like this, rather that the way in which this benefit has been targetted isn't necceserily fair or appropriate.

Whilst not all individuals that are over 50 are pensioners, certainly a great majority are and I think it is where this is targetted at. The unforunate reality is that because pensioners are such a well defined group, well represented and generally with plenty of time on their hands to write to newspapers, politicians etc. their voice has a lot of influence on government policy. The twenty or thritysomethings working hard to try to afford a deposit to buy their first house don't have the time to campaign for help for them, aren't a group that is easily defined and as such isn't represented so their interests aren't considered as highly as other groups.

It would be much easier for ISA providers and the public if these changes were impemented at the same time for everyone rather than earlier to try to please a group which shouts the loudest. The cost in lost tax revenue would be pretty insignificant in the grand scheme of things and anything we can do to encourage younger people to save is a very good thing.

Paul_Herring

it is still a £3000 difference which I would consider to be quite significant.

What sort of capital gains tax are you going to be paying on that £3000 that you couldn't put in an ISA? Not a lot I would have thought.

tad104

I've opened a First Direct ISA that pays 3.01% and a Barclays regular saver that pays 6%.

By my calculations even with tax taken off, it would be better for me to pay my money first into the Barclays regular saver then into the ISA.

Is this correct?

cyclonebri1

tad104 wrote: »

I've opened a First Direct ISA that pays 3.01% and a Barclays regular saver that pays 6%.

By my calculations even with tax taken off, it would be better for me to pay my money first into the Barclays regular saver then into the ISA.

Is this correct?

:T:T:T Exactly, thats the point I was making earlier.

It's ok saying put/keep your savings in a tax wrapper, if you loose it you can never regain it but the fact is the benefit is purely the 20% taxation you save on interest and for now and as it has been for sometime, that is beatable by a good amount.

The banks rely on the brain washing we are getting to allow them to offer such rubbish cash isa rates:mad::mad::mad::mad: