Older savers may receive lower interest rates on ISA top ups

bagsacash

Older savers topping up individual savings accounts (Isas), following the Budget increase in the annual limit to £10,200, could receive a lower interest rate than is paid on their existing balances, experts warn.

http://www.ft.com/cms/s/2/aebb8aac-3102-11de-8196-00144feabdc0.html

opinions4u

BANKS ACCUSED OF RIP OFF EVEN BEFORE THEY'VE RIPPED ANYBODY OFF.

Naughty banks. Tut tut.

ManAtHome

Most people I know held off this years cash ISA until after the budget - always a chance that 'oldies' would get increased allowances or reduction in savings tax - election next year and all that....

Most of us will be opening variable-rate ISAs, if 'top-up' rates (ie the variable rates) are cut, easy enough to move (I'm an oldie btw). My guess is that building societies will be offering better rates than banks as they won't get as much of the taxpayers bail-out dosh as the banks.

nilrem_2

So it seems that the only positive thing in the budget for savers is not really much of a plus!

MarkyMarkD

This is a completely bogus story.

Kevin Mountford is just making stuff up to get his name in the papers.

There is absolutely no likelihood that ISA providers will differentiate between these specific top-ups and any other mid-year ISA top-up - it's simply a nighmare to do that from a systems point of view.

The idea that providers think "ooh, you know what, we could stitch people up who fund mid-year" is rubbish. Thousands of people fund mid-year, every year. If this is a problem now, it would have been a problem then.

As for fixed rates, does anyone seriously believe that rates will FALL by October, given the way the government has screwed the economy? Rather more likely that they will have gone up.

opinions4u

ManAtHome wrote: »

My guess is that building societies will be offering better rates than banks as they won't get as much of the taxpayers bail-out dosh as the banks.

Most of the best buy ISAs in recent weeks have been offered by banks. Nat West and Halifax (where HM Government is the major shareholder) among them.

bagsacash

The idea that providers think "ooh, you know what, we could stitch people up who fund mid-year" is rubbish. Thousands of people fund mid-year, every year. If this is a problem now, it would have been a problem then.


Actually, thats exactly what banks do. Or the alternative would be for them to write on pieces of paper what they would like to do, put all the pieces in a tumbler to mix them up and then draw one at random, or something along those lines.

ManAtHome

opinions4u wrote: »

Most of the best buy ISAs in recent weeks have been offered by banks. Nat West and Halifax (where HM Government is the major shareholder) among them.

True, but the recent downgrades of several societies are still 'under discussion' as they say. If government and institutional funds are reduced or withdrawn, they'll need to attract more savers.

opinions4u

ManAtHome wrote: »

True, but the recent downgrades of several societies are still 'under discussion' as they say. If government and institutional funds are reduced or withdrawn, they'll need to attract more savers.

Nah, they'll get taken over or merged in to Northern Rock.

There is a finite amount of liquid savings out there. Attract it from one provider and you merely destabilise another.

ManAtHome

Blimey, we'll end up sticking all our dosh in the BoG (Bank of Gordon - spookily accurate acronym...).

I'm sure you're not expecting much joined-up thinking either, but The Spiral of Instability is well under way http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article6168866.ece