ISA Newbie

Constant

Hi all,

I've been a reader on here for a long time, but never had anything constructive to give so haven't signed up until now

Right, I've never had an ISA before, and have been reading Martin's tips on which is best etc, noticing I've only got a really short time to use my 09/10 allowance..

I've luckily got a bonus from work, being paid end of this week/middle of next week at the latest.

• Should I get an ISA using this years allowance, then get another after April 5th using 10/11s allowance?
• Are there any benefits of doing this?
• If so, which ISA should I go for, and how do I go about opening one with the 09/10 allowance?

Also, when are details of banks 10/11 ISAs announced? I'm guessing the week of April 5th?

Thanks in advance, sorry this doesn't make much sense. I guess I'm just looking for someone to tell me what to do, lol

Cheers

Ash

Just_landed

1:- Should I get an ISA using this years allowance, then get another after April 5th using 10/11s allowance?
A You can put £3600 into a cash ISA this tax year, £5100 if you are older than 50

2 :- Are there any benefits of doing this?
A A good way of saving for example when you retire your state pension will use up the personal allowance so if your money was earning interest in a savings A/C you would be taxed on it but not in an ISA.
Also if you are a 40% tax payer it will save you even more money, no tax to pay.

3:- If so, which ISA should I go for, and how do I go about opening one with the 09/10 allowance?
A That’s a tricky one, the world is your oyster, depends what you want the money for. If you want to save lump sums like £3600 this tax year then £5100 next tax year, maybe a fixed term cash ISA. Fixed rate/term ISA’s tend to pay a higher rate interest, see Kassa 242 very useful thread and click on a few links to see how to go about opening one. One other tip building societies tend to give higher interest rates than banks.

all the above is my view other people will have their own view.:)

Baldur

Constant wrote: »

Should I get an ISA using this years allowance, then get another after April 5th using 10/11s allowance?

That would certainly optimise your tax free savings potential, as you could subscribe £3,600 (£5,100 if 50yrs of age on or before April 5th**) before 05/04/2010 and another £5,100 on or after April 6th, giving either £8,700 (or £10,200**) earning tax-free interest within a very short period of time.

Are there any benefits of doing this?

As above. The tax-free status of interest earned in Cash ISAs is ongoing as long as it remains within the ISA 'wrapper', year after year, for as long as the ISA scheme lasts.

If so, which ISA should I go for, and how do I go about opening one with the 09/10 allowance?

Your choice - see the current 'best buys in this post http://forums.moneysavingexpert.com/showpost.html?p=4603369&postcount=1

You don't necessarily have to open a new ISA account for your 2010/11 allowance, most easy access ISA accounts permit ongoing subscriptions. For example, Santander's Flexible ISA @ 3.5% with a guarantee of BoE base rate +3% says "If you use your Flexible ISA for your 2009/2010 Cash ISA allowance you can use the same account for your 2010/2011 Cash ISA allowance".

Also, when are details of banks 10/11 ISAs announced? I'm guessing the week of April 5th?

The best rates are normally available for the last month or two of the tax year, lasting a short time into the new tax year. There is no such thing as 'a 2010/11 ISA account' your ISA is defined by the date on which you subscribe your allowance.