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I.F. Mini Cash ISA Bonus Ends 31/01/05

Should I.F. not extend their bonus period end date [as they did last time] their bonus of 0.3% applying to their Mini Cash ISA will end on 31st January.   :'(

Therefore I’m assuming that their rates will drop on the 1st February from:

5.10% to 4.8% Gross for interest paid annually
4.98% to 4.68% Gross for interest paid monthly

I don’t understand their logic – Effectively dropping their interest rate 2 months before the start of a new tax year when every other company offering mini cash ISA’s will be vigorously promoting their product just doesn’t gel.

I’m not up to speed regarding mini cash ISA accounts but guess that the best paying ones will not be announced until February/March.
;)Do It To Them Before They Do It To You ;)
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Comments

  • MJSW
    MJSW Posts: 171 Forumite
    The 0.3% is not bonus, it is a guarantee that the account will pay at least 0.3% above base rate.

    Once the guarantee expires, it doesn't necessarily mean that they will reduce their rate. They are already paying (slightly) more on the account than they need to under the guarantee, as they could pay 5.05% at current base rates. Indeed they have actually been paying more than the minimum rate required under their guarantee for several months. So I personally think it is unlikely that they will slash rates after 31 January 2005, although of course that doesn't mean that they won't!
  • Walletwatch
    Walletwatch Posts: 1,055 Forumite
    These rates are linked to the BoE rates for the variable rate ISA, if that is what you are looking at, and this would, needless to say, directly depend on the way the short term interest rates move, as set by the BoE.

    On the other hand, if you are looking at fixed rate ISAs, I personally don't see a better offer than what is already available coming in Feb/Mar. If you are looking at fixing, the 5.8% five year Halifax is a good bet, though I am not sure it is still available.

    Do check out on their customer service aspect though, as I remember having read some post on this forum about some bad experiences with Hfx for their fixed ISA.
    It's always the grass that suffers, irrespective of whether the elephants are fighting or making love !!!
  • Hi MJSW

    Bonus or Guarantee the fact remains that I.F. only guarantees it’s ”guarantee” until 31st January.
    ;)Do It To Them Before They Do It To You ;)
  • Hi Walletwatch

    I would ideally prefer a variable rate, little or no notice, monthly interest mini cash ISA.

    Just checked Abbey National’s postal ISA.  Interest rate 5.35% AER

    But in their small print:

    *Postal ISA interest rate is guaranteed to be a minimum of 0.50% above the Bank of England base rate until 1st April 2005*

    So now Abbey National could be reducing it’s interest rate just days before the new tax year.
    ;)Do It To Them Before They Do It To You ;)
  • Hi Fastflys

    I personally have the Abbey postal ISA, and my research did reveal that they are known to have high rates on their ISAs, so I do expect them to retain their rates at sufficiently high levels even once they cross the initial period you refer to.

    Having said that, it is understood that if you are rate-sensitive and go for a variable rate product, you need to be on your toes and ready to shift once a rival product comes up offering a sufficiently higher rate.
    It's always the grass that suffers, irrespective of whether the elephants are fighting or making love !!!
  • Hi Walletwatch

    Yes, agreed.

    Considering transferring funds away from I.F. if their interest rate drops in February but to where, that is the question.
    ;)Do It To Them Before They Do It To You ;)
  • M&S Money have a similar guarantee on their Cash Mini ISA, which expires in April too. The best tactic is probably to put your 2003-2004 allowance in whatever is the best available right now, then in April open a new tax year ISA with whoever is then the best and transfer all your existing ISAs into it.
    Cider Country Solar PV generator: 3.7kWp Enfinity system on unshaded SE (-36deg azimuth) & 45deg roof
  • blinko
    blinko Posts: 2,519 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    the M&S cash isa is poor compared to abbey at 5.35% which is the best on the market for non fixed

    halifax hve a fixed isa at 5.7%
    and
    for the besty isa rates check out https://www.moneysupermarket.co.uk

    or alternatively the sunday papers money supplement
  • the M&S cash isa is poor compared to abbey at 5.35% which is the best on the market for non fixed

    M&S Cash ISA is 5.25%, and has risen within a couple of working days of each BoE Interest rate rise. The extra 0.1% of an Abbey ISA just wasn't worth the hassle of switching to once I'd opened my M&S account (the Abbey product wasn't announced until after I had sent application to M&S), especially given the hassle of chasing lost interest when transferring ISAs between providers. The Abbey ISA was also infamously slow to open (in April last year) compared to the M&S ISA which was much quicker in my experience. The M&S ISA is now closed to new customers though.
    Cider Country Solar PV generator: 3.7kWp Enfinity system on unshaded SE (-36deg azimuth) & 45deg roof
  • Speculation over.

    IF are reducing their Mini Cash ISA and TESSA only ISA rates to 5.0% from tomorrow (1FEB05).

    They are also introducing a new rate guarantee of 0.05% above base rate until 31JAN06.
    Up Tipp!
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