Cash ISA vs Egg Savings Account?

tashalove

Hi everyone,

I have just opened an Egg savings account which offers 3.25% and have dumped my savings into this. I also have an ISA with A&L offering 2% variable rate.

My question is, which account am I better off putting new money in? The Egg account seems to offer better interest even with tax applied and as we all know ISAs are not doing very well lately.

I will be regularly saving money every month so is it best to

1) use up my ISA allowance and save the rest into the Egg savings

or

2) put all the money into Egg as the interest rate is higher?

I'm a total newbie at this whole savings business so I'm not sure how to make the best of all the rates offered at the moment. I do realise that there are accounts out there offering better rates, but for the now, can anyone advise on how I should save with the accounts I have just now?

Many many thanks!

Mr_K

Although you'll get more from the Egg account initially, money put in an ISA is sheltered from tax forever (or until they change the rules anyway !). So in 5 years time your money invested this year might still be in a ISA earning 7% tax free. It's a personal choice but I'd always fill up tax free savings first, even if its a lower rate.

YorkshireBoy

You have until 5th April next year to make your decision as to whether to 'use it or lose it'.

So, save with Egg for the time being, and review your options later in the tax year or when a better ISA comes along...whichever occurs first.

rb10

Remember that the Egg account gives instant access, so you can put any new money into Egg for now, and then just transfer money from Egg to your ISA to the maximum of £3600 (or £5100 if you're over 50) by 5th April.

Lokolo

rb10 wrote: »

Remember that the Egg account gives instant access, so you can put any new money into Egg for now, and then just transfer money from Egg to your ISA to the maximum of £3600 (or £5400 if you're over 50) by 5th April.

UH UHHHHH (the wrong sound from family fortunes). :rotfl:

£5100....

rb10

Lokolo wrote: »

UH UHHHHH (the wrong sound from family fortunes). :rotfl:

£5100....

Don't know what you're talking about.


(P.S. How do you get rid of the bit that says 'last edited by rb10 at...' ... that gives it away a bit, lol)

Thanks for spotting that

tashalove

Thanks everyone for the suggestions! I never thought of just leaving the money in Egg, think I will do that for the next couple of months and see how the ISAs fair next year. Thanks again!

Innys

......or you could just transfer your money from the poor A&L one to an alternative paying a much higher rate, like the latest First Direct one.