Over 50's - will you take out an ISA now or delay until October

Steve_xx

rb10 wrote: »

Ok, so have two accounts, each with a different bank. This is not too hard to keep track of, and gives you a total of £100k limit.

It's no problem to me to keep multiple accounts, rather I was thinking about other people.

triplea35

Unfortunately I rather hastily decided to open ISA's for my wife and I before the budget. We are bith over 50 and as we are saving I decided to go for the 7% Fixed Rate Regular Saver with First Direct.( all my earlier years allowances are in fixed rate/term accounts) At the old ISA allowance you were allowed to pay in a max of £300 per month reaching the £3600 allowance in month 12, and we made the first payment of £300 each prior to the budget. It would be interesting to know what is ikely to happen to this account now. To reach the new allowance we could each deposit £425 per month + the £125 from last month. Nothing on the FD website yet. Anyone got any idea? Will give it a couple of weeks and enquire if nothing appears.

evenasus

Steve_xx wrote: »

However, with the fact that ISA's have been around for 10 years now, and considering that now the maximum deposit will be £5100 in each tax year, it means that many savers will, if they have left their ISA's untouched for all of this time, be getting close to the £50k FSCS limit if they hold their ISA with just one provider!

No government or tax official, to my knowledge, seems to have noted that this is fast becoming a problem that will need dealing with specifically.

I stuck the max in a Nationwide ISA for some years as did my husband.
The reason I opened a Barclays Golden ISA this year is because of the guaranteed £50K.
My husband has more in his Nationwide fixed rate ISA (includes matured Tessa) than I do and with interest this year will be almost at the limit. Somehow, one year I opened a Bradford & Bingley ISA along the way. This is now in a fixed rate Northern Rock ISA.

I read somewhere that there's a chance of Northern Rock being sold to Santander.
This will mean anyone with £50K in a Northern Rock ISA will be worried if they have substantial savings in any of the Santander institutions.

The way things are going with take-overs, makes spreading finances more difficult.

Steve_xx

evenasus wrote: »

I stuck the max in a Nationwide ISA for some years as did my husband.
The reason I opened a Barclays Golden ISA this year is because of the guaranteed £50K.
My husband has more in his Nationwide fixed rate ISA (includes matured Tessa) than I do and with interest this year will be almost at the limit. Somehow, one year I opened a Bradford & Bingley ISA along the way. This is now in a fixed rate Northern Rock ISA.

I read somewhere that there's a chance of Northern Rock being sold to Santander.
This will mean anyone with £50K in a Northern Rock ISA will be worried if they have substantial savings in any of the Santander institutions.

The way things are going with take-overs, makes spreading finances more difficult.

I believe that Santander and Alliance & Leicester are currently operating under separate licences. But yes, these things are all requiring careful consideration.

Hopefully, as a result of the banking fiasco there will be new tougher regulation to prevent banks getting into difficulty through reckless behaviour. I think things are on a more evn keel now, perhaps with the worst of it dealt with. But I think there will be some more bad banking news, though maybe to a lesser degree than there has been.

MarkyMarkD

I don't see any need at all to consider the £50k limit. Nobody made anybody put all their ISA funds in one institution. Even if that is what people have ended up with due to mergers, it is a relatively simple job to move part of the money to another provider.

I am profoundly against the government making pointless changes to resolve problems which don't really exist - such as the increased FSCS limit applicable to building societies which have merged. Nonsense, and anti-competitive. What they should have done is allowed an increased limit ONLY in respect of accounts with penalties - chiefly fixed rate bonds - and in respect of those, only until the penalties expired at which point the funds could be moved elsewhere. In this instance, YBS and Nationwide's special pleading has got a result which is wrong. It can only be hoped that the short-term provisions do not become permanent.

Mikeyorks

triplea35 wrote: »

Anyone got any idea? Will give it a couple of weeks and enquire if nothing appears.

The Budget hasn't been enabled by Parliament yet ... and even when it is the increased allowance you're talking about doesn't apply until 6th October. And between the 2 dates ... HMRC have to meet with the ISA Managers and determine how the new allowance is going to be facilitated / monitored.
So I would give it at least a couple of months before you start expecting to see any detail?

triplea35

Mikeyorks wrote: »

The Budget hasn't been enabled by Parliament yet ... and even when it is the increased allowance you're talking about doesn't apply until 6th October. And between the 2 dates ... HMRC have to meet with the ISA Managers and determine how the new allowance is going to be facilitated / monitored.
So I would give it at least a couple of months before you start expecting to see any detail?

Hi Mikeyorks. Thanks for that. I did realise that the new allowance does not take effect until October. I suppose what I was pondering upon is that if I was allowed to increase the monthly payments of the new maximum/12 my ISA balance would still be well below the current allowance upto October increase.
I didn't realise about the Budget being enabled etc so will just have to wait and see.

melbury

Have already used up the £3600 cash ISA limit for this tax year, but does this mean that in October I can pay in another £1500?

Steve_xx

melbury wrote: »

Have already used up the £3600 cash ISA limit for this tax year, but does this mean that in October I can pay in another £1500?

Yes, if you are over age 50.

evenasus

MarkyMarkD wrote: »

I don't see any need at all to consider the £50k limit. Nobody made anybody put all their ISA funds in one institution.

For people with, say £300K, they have to put it in at least seven different institutions, to keep within the £50K. This is allowing for interest.