Please explain ISA to me

edited 30 November -1 at 1:00AM in ISAs & Tax-free Savings
6 replies 4.2K views
mboromboro Forumite
294 Posts
edited 30 November -1 at 1:00AM in ISAs & Tax-free Savings
I want to save money with RBS they have suggested I open up an ISA and put in £25 per month .their interest rate is 4% is this good ?

I have no idea how an ISA works ?:o

Replies

  • Mr_MumbleMr_Mumble Forumite
    1.8K Posts
    "The state is the great fiction by which everybody seeks to live at the expense of everybody else." -- Frederic Bastiat, 1848.
  • Joe_BloggsJoe_Bloggs Forumite
    4.5K Posts
    It is a crappy rate of no significance in your circumstances. Do not let this issue deflect you from paying your debts. The coucil tax is a crown debt. Do not get into their bad books for non payment of council tax. Have you tried the citizens advice bureau for financial advice regarding your debts ?
    J_B.
  • mboromboro Forumite
    294 Posts
    Debts are all in hand and are being paid off monthly with the advice and help of CCCS meaning I have £300 left to live on and save.

    EDIT..I have updated my siggy.
  • jimclark1967jimclark1967 Forumite
    499 Posts
    You're still better off putting any spare cash towards paying off the debts earlier if the interest rate is more than about 4%

    What is the interest rate on your "online finance" for example?

    JC
  • MilarkyMilarky Forumite
    6.3K Posts
    Part of the Furniture 1,000 Posts Photogenic
    ✭✭✭✭
    For £25 per month (and up to £250 per month in months when you have extra to save) you can currently get 6% (lot better than 4%) in the Scarborough Building Society 'my savings'.
    .....under construction....
  • cheerfulcatcheerfulcat Forumite
    3.3K Posts
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    ✭✭✭✭
    mboro wrote:
    I want to save money with RBS they have suggested I open up an ISA and put in £25 per month .their interest rate is 4% is this good ?

    I have no idea how an ISA works ?:o
    Hello, mboro,

    That rate, as others have said, is pretty poor. You can compare rates at moneysupermarket.com.

    ISAs are tax-free deposit or stock market-based accounts - there is a fuller account here. Put simply, you are allowed to save ( cash ) or invest ( shares ) a certain amount in a special account ( ISA ) every year. Previous years' contributions and any gain they have made continue to roll up tax free. Nothing in the ISA has to be declared to the taxman. The ISA scheme replaced the more generous PEPs and TESSAs of the previous government - there is no guarantee that it will continue beyond 2010 ( but it is guaranteed until then ).

    HTH

    Cheerfulcat
This discussion has been closed.
Latest MSE News and Guides

Card providers to reserve up to £100

When you pay at supermarket fuel pumps

MSE News

Cheap contents insurance for tenants

DON'T assume your landlord covers you

MSE Guides

Summer sizzlers round-up

Incl £2ish sun cream & £1.50 disposable BBQs

MSE Deals