First Direct Regular Saver & Over 50.

triplea35

Unfortunately I rather hastily decided to open ISA's for my wife and I before the budget. We are both 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.

KTF

Most banks are probably still deciding how to implement the change. You could always give them a call and ask.

opinions4u

Give the poor blighters a chance!

Natti_A

I enquired over the phone yesterday, on behalf of my Mum, and they don't know yet how/if they are going to change the RS ISA.

YorkyBar_2

I have now contacted First Direct 3 times over this issue with the response that they will make a decision nearer the time. I'm very unhappy with this as it indicates to me that they are considering a course of action that is disadvantageous. I'm going to transfer to another provider.

KTF

What makes you think that? Assuming the banks have had no prior knowledge of this change then they cant be expected to think up a response overnight. What difference does it make if they tell you now or nearer the time as you cant take advantage of the change until its 'live'.

rb10

YorkyBar wrote: »

I have now contacted First Direct 3 times over this issue with the response that they will make a decision nearer the time. I'm very unhappy with this as it indicates to me that they are considering a course of action that is disadvantageous.

Remember that the Government still haven't confirmed exactly how it'll work, so banks can hardly start making up their own rules before they know what they'll have to work alongside, can they?

They still have five months to come up with a plan ... that's quite a long time.

YorkyBar wrote: »

I'm going to transfer to another provider.

Can you get a better rate from another provider? If so, then by all means transfer. If not, then it's only you who'll lose out.

YorkyBar_2

Can you get a better rate from another provider? If so, then by all means transfer. If not, then it's only you who'll lose out.[/QUOTE]

I guess I'm thinking that:

(a) If FD disallow topping-up this year, then over a 10 year period you would lose £15k of tax free saving

(b) If I wait until October to transfer to another provider, then FD will penalise me by dropping the transferrable amount to their standard ISA interest rate, so I may will as well transfer now for a better rate

(c) They could at least assure savers that they will allow topping-up to £5,100 (at whatever interest on the additional sum)

jimbow25

YorkyBar wrote: »

I have now contacted First Direct 3 times over this issue with the response that they will make a decision nearer the time.

Nearer what time? The change in the budget affects the annual allowance from October for over 50s but it doesn't say a regular savings account can only contain £1,800 after 6 months - that's First Direct's policy.

Any other cash ISA will let you pay in £425 per month so long as you don't exceed your annual allowance - you still wouldn't be anywhere near £3,600 deposited by October - so they could change their policy now to allow people to save the same amount in each month of the year.

I'm not saying they will or they definitely should have done anything about it by now, but it's not surprising people would like think the restrictions will change in light of increased allowances, there's no reason why everything has tostay the same for 6 months.

YorkyBar_2

First Direct have just confirmed to me that they are going to allow topping-up: "The extra allowance will be allowed into the Regular Saver ISA but not until the 6th October for the over 50's"

charlieboycat

YorkyBar wrote: »

First Direct have just confirmed to me that they are going to allow topping-up: "The extra allowance will be allowed into the Regular Saver ISA but not until the 6th October for the over 50's"

I wonder if this will be by way of increasing the regular monthly payment from £300 to £550 for the last six months of the tax year. Or whether one will be able to make a one-off "catch-up" payment of £750 on/after 6th October followed by six installments of £425. [Figures assume ISA started post 5th April, pre 6th May.]

I'd like to think the latter, but my guess would be the former. Time will tell. Whichever, its good to know that the extra will be allowed in.

Whatever the answer, the standing order will presumably have to be amended online. It will be interesting to see if First Direct automatically contact their over 50's subscribers to tell them this.