Nationwide e-ISA

joeypesci

I'm looking at this

http://www.nationwide.co.uk/savings/cash_isa/eisa/default.htm?intcmp=Intcmp_0106

As I'm already with Nationwide I was just going to go with them and their ISA, just to make it easier. Is this a good ISA or not that great as I see this in small print and not sure I understand it

Rate illustrated based on annual rate and balance £1+. Core rate 1.75% gross p.a./AER variable on balance £1+. Minimum opening balance £1. Available to our card account customers (excluding regular savings). e-ISA is a cash ISA.

As that 1.75% is a lot less than the 2.67%

I was going to use it so I can start to transfer money from the e-savings account I have with them into it. And maybe put some of my wages I get each week (still a temp hence the weekly wage but on a decent £12ph although for IT I'd like more but it's public sector work). With this it looks like I can. With their instore 3 year one I think you have to put a lump sum in and that's it. They did tell me the other day they now have a 6 year one, but I didn't get much details as I was in a rush.

KingL

There is a bonus element to the interest rate that evaporates in June 2011. The details in the small print are what's left after the bonus element ends. As long as you transfer it elsewhere next June, it's OK, but look at the alternatives here


With any standard fixed rate (2 year, 3 year, 6 year, whatever) you won't be able to add in more money into as you go along.

Granadalad

Coincidentally Nationwide wrote to me today to present options for my maturing fixed rate ISA. The e-ISA looks good (well, if current rates can be considered as good) for me. A bonus rate of 1% is paid until 30 June 2011, so core rate of 1.75% is inflated to 2.75% gross (2.67% AER). I confess I can't quite see why gross and AER differ in this case.

For a higher rate with Nationwide you'd need a 3 year fix for 3.75% or 2 year commitment for a tracker which currently yields less than the e-ISA. Their instant access and members ISA bonds are hopeless.

You can't go too far wrong as you can transfer the e-ISA somewhere else without penalty if it looks like a poor choice later.

KingL

Granadalad wrote: »

I confess I can't quite see why gross and AER differ in this case.

Gross and AER would only be the same if the headline rate was available for a full year. As it is, you would only get the 2.75% rate for the first 10 months, so the AER is correspondingly lower.