Halifax ISA Saver Direct 5% rate to be cut

bjp79

Ok... So say I set up the transfer from Halifax to A&L today...

Halifax would pay me what's due in interest on the day that its due to transfer accross to A&L - e.g. If I had the full 12 months of interest on 3k, they'de pay me £3150 (or however much is due) right before it went to A&L... whether its before their 1st April anniversary date?

Say my transfer goes through after the tax d-day - would I still be allowed my 3k to contribute in the 06/07 financial year - or does a transfer after tax d-day nullify my right to contribute? If I'm going to transfer - is it essential I do it before the 5/6th April tax day?

mary

bjp79 wrote:

Ok... So say I set up the transfer from Halifax to A&L today...

Halifax would pay me what's due in interest on the day that its due to transfer accross to A&L - e.g. If I had the full 12 months of interest on 3k, they'de pay me £3150 (or however much is due) right before it went to A&L... whether its before their 1st April anniversary date?

Say my transfer goes through after the tax d-day - would I still be allowed my 3k to contribute in the 06/07 financial year - or does a transfer after tax d-day nullify my right to contribute? If I'm going to transfer - is it essential I do it before the 5/6th April tax day?

I have a total of 4 ISAs including this years 05/06 currently with Halifax.
I am going to transfer tthe 4 ISAs to A&L 5.2% and start up no 5 after April 6th. Despite the fact that I have an A&L Regular Saver, normal saver & A&L credit card with them, I still have to go into a branch and do it, as I'm told it will be quicker and show ID. I told them I didn't see the point in showing ID, since i already had 3 accounts with them. It made no difference. They told me I could apply on line, but when I did, I realised I had to tick the box and accept the ts & cs whereby I said I didn't have any other ISA for this current year, but I do. So I was then given the Booking number to make an appointment to go into my local branch. So I rang them and asked them to send me out the form applying for the current ISA, together with an ISA Transfer form. I then have to go into the branch with the ID, they will not do it immediately as it is obviously a busy time of the year, but they will process it when they have a quiet spell and no queues in the branch. I specifically told them I did not want a 45 minute interview they were offereing me so I could have a financial overhaul, as I knew exactly what I wanted and was in control of my own finances. They would then send the form to Halifax for them to send on the 4 ISAs to A&L.

Interest is paid on whatever money you have with Halifax up to the point of departure of money (i.e. whether March 30th, April 4th or whatever). Then once your money is with A&L your ISA starts earning interest from the day the funds are cleared into their account.

So, whenever you transfer through your old ISAs, you are stilll entitled to the next financial year's allocation as well. You can have an allowance of £3k for each year, regardless of when you do the transfer.

Mikeyorks

hansi wrote:

yes, I know that it's a fixed rate and it's for a fixed term but my transfer will take place before 5th April, so from the 6th April I can deposit another £3000 into the Fixed rate ISA. Correct?

To be semantic - no, not correct. But from 6th April you can deposit a further £3k into a Fixed Rate ISA.

The previous poster wasn't trying to insult your intelligence by quoting 'fixed rate / fixed term'. He was pointing up that the variability stopped ISAs being 're-used' in later years. I think the original concept was that ISAs could be added to in later tax years (subject to the £3k cash ISA limit) - but that has gone by the board because of interest / term variations. Too complex to have multiple years within a single pot given the permutations of interest / term.
So ISAs are now specific to tax years. And you can happily open a fresh one from 6th April - be it fixed or variable and be it from 1 - 4 years depending on what is on offer for each type.

But the fact you are transferring earlier years, whenever you do that - has no bearing on your next year entitlement

sloughflint

bjp79 wrote:

Ok... So say I set up the transfer from Halifax to A&L today...

Halifax would pay me what's due in interest on the day that its due to transfer accross to A&L - e.g. If I had the full 12 months of interest on 3k, they'de pay me £3150 (or however much is due) right before it went to A&L... whether its before their 1st April anniversary date?

Say my transfer goes through after the tax d-day - would I still be allowed my 3k to contribute in the 06/07 financial year - or does a transfer after tax d-day nullify my right to contribute? If I'm going to transfer - is it essential I do it before the 5/6th April tax day?

I think you can transfer anytime you like and yes you certainly can use your 06/07 allocation.
Do consider this though: Halifax use stakeholders standards ( formerly CAT) and don't charge to leave in the future. A& L could at any time so for that reason I am leaving my lot with Halifax.

isasmurf

sloughflint wrote:

Do consider this though: Halifax use stakeholders standards ( formerly CAT) and don't charge to leave in the future. A& L could at any time so for that reason I am leaving my lot with Halifax.

I've seen this point a lot recently. Do consider this as well: Halifax could introduce a transfer charge at ANY time and from that point it will cease to be a Stakeholder standard ISA. Having the standards only mean that the current terms meet Stakeholder standards, not that they will never change the terms in future to be less favourable than the minimum required for Stakeholder terms.

sloughflint

isasmurf wrote:

I've seen this point a lot recently. Do consider this as well: Halifax could introduce a transfer charge at ANY time and from that point it will cease to be a Stakeholder standard ISA. Having the standards only mean that the current terms meet Stakeholder standards, not that they will never change the terms in future to be less favourable than the minimum required for Stakeholder terms.

Oh no!
What's the point of having the standards then? Would we have any rights concerning the funds already deposited? Surely there is a case for arguing in the future that at the time of taking the ISA, those standards where in place and so no leaving fee should be made ( ie only charge new customers who agree to new T& C)
I'll be annoyed if all my research was for nothing ie banks being able to opt in and out of standards at their leisure.

derrick

hansi wrote:

yes, I know that it's a fixed rate and it's for a fixed term but my transfer will take place before 5th April, so from the 6th April I can deposit another £3000 into the Fixed rate ISA. Correct?

Yes you can, if you read my post again you will see I have already said so, as it will be a new tax year and your new allowance of £3000 for a cash ISA begins

mike33_2

alared wrote:

This cut is probably designed to get people to switch their cash into the fixed rate.
Is the extra .25% worth bothering about when you lose the instant access and can`t get at your dough.
On £10k you`re only talking about £25 a year.

Ok first post here goes,i was also thinking of changing over to the fixed rate halifsx isa from the other halifax isa with the .25% cut coming into force soon-just about able to afford it at a push for a year but as alred says is it really worth it with the interest been not that much so still not sure-whos going to sway me.

pavlovs_dog

i knew that would happen!

im in the iddle of transfering from HSBC to halifax.

looks like i'll either be shopping around or going for a fixed term

Kazza242

mike33 wrote:

Ok first post here goes,i was also thinking of changing over to the fixed rate halifsx isa from the other halifax isa with the .25% cut coming into force soon-just about able to afford it at a push for a year but as alred says is it really worth it with the interest been not that much so still not sure-whos going to sway me.

For me the clincher is whether or not you are able to tie your money up for a year? If yes, then the Halifax 5% 1 year fixed-rate ISA option looks pretty good. At the moment, the general trend amongst banks and building societies seems to be towards reducing the interest rates they offer on their isa's and savings accounts. With this in mind, a fix - for a short-term period doesn't seem a bad idea.

Of course, although we know the ISA Saver Direct will be paying 4.75% from April 6 2006, there is nothing to stop Halifax reducing the rate further, as it is a variable rate product. There would need to be at least two BOE 0.25% rate rises before the rate on the variable rate ISA could outdo the 1 year fixed rate offering.

It's completely up to you what you decide.