ISA rates: hold out or open now?

7sefton

The ISA season is now in full flow, with Santander storming to the top of the best buy tables with its 3.5% Flexible ISA offer. Nationwide has also revamped its range, whilst tomorrow (Monday) will see Yorkshire & Clydesdale banks offer attractive fixed rate options.

I know nobody can give a definite answer, but when would you say we can be fairly sure all the best deals have been released? Barclays, for example, usually tries to be a big player in the ISA market but hasn't launched a new account as yet. In other words, when will most of the best deals be out in the open: a week, a bit longer, or even after April?

Consumerist

Apply now. Apply now. Apply now. :T

If anything better comes along then apply for that too.

Providing you don't contribute to more than one in any tax year, you are not breaking the ISA rules.

So, apply for them all, if you want to, then select the one you want when you think its as good as it's going to get. :beer:

Good luck.

Mickygg

Hard one. If you are on a rubbish rate, I would defo apply now. There will be new ones coming out - but lets face it an ISA at 6% wont come out with base rates as they are!!

If you are in no rush, I would sit it out, but no longer than end of March.

Lokolo

Mickygg wrote: »

Hard one. If you are on a rubbish rate, I would defo apply now. There will be new ones coming out - but lets face it an ISA at 6% wont come out with base rates as they are!!

If you are in no rush, I would sit it out, but no longer than end of March.

If you have seen delays before you would change that statement

withabix

I can't see there being much (if anything) over 3.5% this year. 3.5 is good. Barclays offered 3.55% last year and were top. This year they are a good bit lower.

Rates are on the way down, as the banks have got plenty of money now, so don't need to pay as much to compete for ours.

tripleblack

Can you actually apply for one now for the following tax year? It was my understanding if you opened one now it would be for 2009/10 tax year? I would like to do this as there seems to be some decent deals about and saves all the waiting around come march but my guess is these are just for people who haven't used up there allowance and they're just mopping up...rates may drop come march

Mickygg

Lokolo wrote: »

If you have seen delays before you would change that statement

Very good point!! Just saw a thread that reminded me as well - Easter falls in the first week of April, so yes to be sure it is worth looking at now, no later than mid-March.

Mickygg

tripleblack wrote: »

Can you actually apply for one now for the following tax year? It was my understanding if you opened one now it would be for 2009/10 tax year? I would like to do this as there seems to be some decent deals about and saves all the waiting around come march but my guess is these are just for people who haven't used up there allowance and they're just mopping up...rates may drop come march

Don't quote me on this, but another thread for the A&L 3.5% one said you can do this, although the account is opened from when you apply so you will miss a month or so of the full years interest guarantee.

I was tempted, but am worried this will cause confusion so I am personally going to leave it until after 6th April

Consumerist

tripleblack wrote: »

Can you actually apply for one now for the following tax year?

My understanding of the ISA rules is that you cannot contribute to more than one ISA in any tax year (there is a technical exception when converting a cash ISA to a stocks & shares ISA).

Nothing in the ISA rules prevents you from opening as many ISAs as you want provided you only pay into one of them.

Once an ISA is open it can remain empty until the end of the following tax year when it becomes void. When you do make a deposit, it will be part of the ISA allowance for the then current tax year.

So, in theory, if you open an ISA now (2009/10) and leave it empty until after the 5 April then any deposit made will be part of the next year's (2010/11) ISA allowance - even though the ISA was opened in the 2009/10 tax year.

It is normal, anyway, for an ISA application to include "subsequent" tax years. If you do not contribute in the following tax year then you have to re-apply for any new ISA with that institution
.

Lokolo

Consumerist wrote: »

My understanding of the ISA rules is that you cannot contribute to more than one ISA in any tax year (there is a technical exception when converting a cash ISA to a stocks & shares ISA).

Nothing in the ISA rules prevents you from opening as many ISAs as you want provided you only pay into one of them.

Once an ISA is open it can remain empty for as long as you want. When you do make a deposit, it will be part of the ISA allowance for the then current tax year.

So, in theory, if you open an ISA now (2009/10) and leave it empty until after the 5 April then any deposit made will be part of the next year's (2010/11) ISA allowance - even though the ISA was opened in the 2009/10 tax year.

It is normal, anyway, for an ISA application to include "subsequent" tax years. If you do not contribute in the following tax year then you have to re-apply for any new ISA with that institution
.

Only problem is that some ISAs require a deposit.

robin58

Mickygg wrote: »

Don't quote me on this, but another thread for the A&L 3.5% one said you can do this, although the account is opened from when you apply so you will miss a month or so of the full years interest guarantee.

I was tempted, but am worried this will cause confusion so I am personally going to leave it until after 6th April

Yes but if you put in the full allowance for this year, £5100 if over 50 and then add another £5100 after 6th april, you could be earning tax free interest for 11 months on £10,200.