Abbey Super Direct ISA

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pedgepuk
pedgepuk Posts: 111 Forumite
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in ISAs & tax-free savings
Hi all,

As much as I hate Abbey they seem to be the only bank offering a more competitive ISA interest rate than any of the other banks.

I've a couple of Halifax regular saving accounts coming to the end of their 12 month term amounting £12k plus £16k in ISAs from previous years which I want to move to a much better rate.

Now Abbey seem to have the Super Direct ISA at 5.5% subject to investing the same ISA deposited amount into one of their investment products for either 3.75 or 5.5 years. I don't mind putting £14k in each to get the 5.5% for a year and locking money away for under 4 years.

Super Direct ISA

Has anybody had any experience in such investment plans and can anybody give advice to me taking one of these out?

If there's any alternatives out there then I'd appreciate any pointers.

TIA

Pete
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  • dunstonh
    dunstonh Posts: 116,463 Forumite
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    The investment product is pretty awful. Similar GEBs can get you 8% p.a. for 5 or 6 years. So, the 3.75% is very weak compared ot those. They are basically subsidising a good rate with an awful one.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Baldur
    Baldur Posts: 6,565 Forumite
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    Abbey have been dangling variations of this type of 'juicy worm' on their hook for some time in an effort to catch unsuspecting savers.
  • slinga
    slinga Posts: 1,485 Forumite
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    dunstonh wrote: »
    The investment product is pretty awful. Similar GEBs can get you 8% p.a. for 5 or 6 years. So, the 3.75% is very weak compared ot those. They are basically subsidising a good rate with an awful one.

    Would you care to name similar GEBs offering 8% for 5 or 6 years.

    I'd be interested in them.

    Thanks.
    It's your money. Except if it's the governments.
  • dunstonh
    dunstonh Posts: 116,463 Forumite
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    Would you care to name similar GEBs offering 8% for 5 or 6 years.

    NDF, Premier, Investec, Arc plus others have rates in the 7-8% range.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • slinga
    slinga Posts: 1,485 Forumite
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    dunstonh wrote: »
    NDF, Premier, Investec, Arc plus others have rates in the 7-8% range.

    Can't find anything.

    Could you give a specific url for one and then I'll know how to look up the others.
    It's your money. Except if it's the governments.
  • Aegis
    Aegis Posts: 5,688 Forumite
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    slinga wrote: »
    Can't find anything.

    Could you give a specific url for one and then I'll know how to look up the others.
    Here's one. Please note that I'm not advising this (because I can't), I'm just providing it in response to requests for information ;)

    http://www.investecstructuredproducts.com/products/products_ftse100_RPI_plan7.html
    I am a Chartered Financial Planner
    Anything I say on the forum is for discussion purposes only and should not be construed as personal financial advice. It is vitally important to do your own research before acting on information gathered from any users on this forum.
  • slinga
    slinga Posts: 1,485 Forumite
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    Aegis wrote: »
    Here's one. Please note that I'm not advising this (because I can't), I'm just providing it in response to requests for information ;)

    http://www.investecstructuredproducts.com/products/products_ftse100_RPI_plan7.html

    Thanks for that info.

    I would have been interested except I've been bitten by the FTSE not falling below ... back in 2001 was it, with an NDF scheme and now I'm twice shy of them, even though you can't see the FTSE falling 50% in your wildest dreams.:eek:
    It's your money. Except if it's the governments.
  • dunstonh
    dunstonh Posts: 116,463 Forumite
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    slinga wrote: »
    Thanks for that info.

    I would have been interested except I've been bitten by the FTSE not falling below ... back in 2001 was it, with an NDF scheme and now I'm twice shy of them, even though you can't see the FTSE falling 50% in your wildest dreams.:eek:

    The ones from back then were typically if the FTSE didnt fall below the same level you entered in at. The ones available now are if the FTSE doesnt fall below 50% of its current level at maturity (although a few do say during the 5 years so be wary of those).

    So, the judgement call is; is the FTSE likely to be 50% lower than it is now in 5 years time? That has to be very unlikely. It is of course a possibility though.

    If someone is using their interest to provide an income and now having to erode their capital as the interest isnt enough, then these plans can be worthwhile as you could take the 5% to live on, leave the surplus 3% in your savings account which builds that up a bit and if the FTSE doesnt drop you are quids in, if it does drop by more than 50% then the amount of reduction on your capital may still be a lot less than the capital erosion that would have occured on the savings account.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • djantler
    djantler Posts: 17 Forumite
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    Is it possible to invest in these directly as a private investor (i.e. not through a financial advisor)? The brochure for the investec one for example seems to expect it to be done through an IFA.
  • Baldur
    Baldur Posts: 6,565 Forumite
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    djantler wrote: »
    Is it possible to invest in these directly as a private investor (i.e. not through a financial advisor)?
    Some appear to be. From memory, a recent Premier offering was available directly to individuals or via IFAs.
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