HELP - I thought I was smart, but I'm just confused

davidmckay

Hi guys Sorry to ask another question in this forum, but I'm a bit confused. I am ready to use this years £5100 cash ISA allowance. I have opened an online flexible ISA with A & L this week, but haven't paid any money into it. I also have about £3700 in the Barclays Golden ISA form last financial year that I need to move. The trouble is, the A & L flexible ISA doesn't allow transfers in. My question is, can I open up another ISA with someone else (eg Nationwide Champion ISA) that does allow transfers in. Provided I don't put any new money in the Nationwide ISA, presumably I'm not breaking any rules. I'm just not sure as technically I'm "opening" two accounts in the one year, even though new money is only going into one of the accounts. I hope this isn't too dumb a question; I thought I was reasonably smart but this one has got me stumped. Thanks.

MoneySavingUser

yes as long as you only put new money in/subscribe to 1 ISA it is fine

davidmckay

Cool. Thanks for replying so quickly. Now I just need to find an ISA that I can open with a transfer only....the Nationwide and M & S ones need you to make a cash deposit....:(

koopa_coffee

If you don't mind fixing try Kent Reliance. They're offering 3.25% to December 2011

Spiggle

davidmckay wrote: »

Cool. Thanks for replying so quickly. Now I just need to find an ISA that I can open with a transfer only....the Nationwide and M & S ones need you to make a cash deposit....:(

Hi,

Most of the accounts that allow transfers will allow you to open an account with the transfer amount, check t&c and give them a call if necessary.

Blueberrypie has a very good way of getting over the confusion with 'opening' accounts - forget the word 'opening'. Think of it as this years allowance (new money) is 'subscribing' (you can only do this to one account per annum) and moving matured balances (previous years ISA) as 'transferring'. Then you have no confusion.

Spigs

newtoncrosby

Hi, newbie here!

I have a related question which is leaving me confused re: 'transferring' ISAs:

I have approx balance of £3300 in old ING ISA opened in 2007 - I've made several movements in and out over the years as I've needed the cash, however as of 2009 it will no longer accept new deposits plus interest rate is sucky @ 1%.

I now have approx £1300 which was previously in this ISA but I moved out as a short term loan to somebody - now repaid. As I can't pay back in I was considering opening new ISA with Barclays (Golden ISA Issue 2or something).

It says the Barclays ISA does not accept transfers from other ISAs - fine. But as the total amount of cash I have saved is less than £5100 limit, what is to stop me from closing ING 1% ISA, transferring to my current account and then transferring from current account into Barclays 3% ISA along with the £1300?

My logic being that its better to earn 3% on £4600 total than 1% on £3300 and 3% on £1300 separately? I'm not in the position now nor will be in the foreseeable future of using my total £5100 allowance every year as I can't save that much up each year anyway!

Sorry for long post, thanks in advance for any advice.

Spiggle

newtoncrosby wrote: »

Hi, newbie here!

I have a related question which is leaving me confused re: 'transferring' ISAs:

I have approx balance of £3300 in old ING ISA opened in 2007 - I've made several movements in and out over the years as I've needed the cash, however as of 2009 it will no longer accept new deposits plus interest rate is sucky @ 1%.

I now have approx £1300 which was previously in this ISA but I moved out as a short term loan to somebody - now repaid. As I can't pay back in I was considering opening new ISA with Barclays (Golden ISA Issue 2or something).

It says the Barclays ISA does not accept transfers from other ISAs - fine. But as the total amount of cash I have saved is less than £5100 limit, what is to stop me from closing ING 1% ISA, transferring to my current account and then transferring from current account into Barclays 3% ISA along with the £1300?

My logic being that its better to earn 3% on £4600 total than 1% on £3300 and 3% on £1300 separately? I'm not in the position now nor will be in the foreseeable future of using my total £5100 allowance every year as I can't save that much up each year anyway!

Sorry for long post, thanks in advance for any advice.

Hi newtoncrosby,

if you're sure you're not going to need your allowance there is nothing to stop you doing what you have outlined.

Do look at all the available rates though as you can get an easy access guaranteed not to fall below 3.2% from A&L (and it could rise if base rates rise). There is another thread on here that gives informationon on the Best Cash ISA rates so do check it out.

You may also want to consider whether or not you want to take out a fixed rate ISA for a period from 12 months to 5 years at which you will get better rates but there is unlikely to bae the ability to withdraw during the fixed term without penalties.

Hope that helps,
Spigs