worth starting an ISA now?

jedbo_2

Hi thanks for reading this in advance.
My partner and I have around £30,000 in liquid cash at the mo. I want to put some (around 20k) of it into isas. Can I start one for each of us now with a full amount of £5100 and then another one each in April? Also what would happen to the intrest rate of the first two when april comes around. an advice would be welcomed but please remember I'm pretty new to this. cheers

Lokolo_2

jedbo wrote: »

Hi thanks for reading this in advance.
My partner and I have around £30,000 in liquid cash at the mo. I want to put some (around 20k) of it into isas. Can I start one for each of us now with a full amount of £5100 and then another one each in April?

Yes you can

jedbo wrote: »

Also what would happen to the intrest rate of the first two when april comes around. an advice would be welcomed but please remember I'm pretty new to this. cheers

Interest is calculated daily and paid periodically depending on what the provider offers, so you will earn the interest accrued from the day your money first hit the ISA account. :j

The main reason to get an ISA is for the tax-free benefits so ISA's are ideal if you are a taxpayer, but in some cases you can earn higher interest with your money using other savings options such as Lloyds Vantage or Santander first home saver (search the forum for threads relating to these accounts for more info)

lvm

Put the £10, 200 in to 2 seperate ISAs just now (Halifax at 3% if you're a Reward account holder) then open new ISAs in April with the 3% (or better if you can find them) and transfer your £10, 200 balance plus interest into your new ISAs.

Apparently if you phone Halifax they will even just keep you on the Reward 3% rather than revert you to 0.1%...

jedbo_2

Thanks so much for your replies. Don't really want to go with santander as I am using the Lloyds vantage for my current account.Looking at the nothern rock 3% isa for the first two ISAs. Then again I don't suppose it really matters if I am going to empty it in a few weeks.Any alternative ideas please keep em coming.

pqrdef

jedbo wrote: »

Then again I don't suppose it really matters if I am going to empty it in a few weeks.Any alternative ideas please keep em coming.

You don't have to start new ISAs in April. You can just put new chunks of money into the ISAs you've already opened, unless the T&Cs don't allow top-ups.

jamesd

You might also consider using your full ISA allowances, not just half of them. It's never too late to start to learn about how to invest money in funds within a stocks and shares ISA, which usually doesn't involve direct buying and selling of shares.

missile

jedbo wrote: »

...Any alternative ideas please keep em coming.

You might want to consider the Halifax FRISA paying 4.25% apply on line here> http://www.halifax.co.uk/savings/accounts/cash-isas/fixed-rate-isa/

Blackdeal

ISAs are a great way to start saving with their tax free benefits. You can open an ISA now at £5100 and then another in April, at which point the limits increases slightly due to the new index link. However with £30k available you may want to consider getting Independent Financial Advice to help you explore a range of options, especially when rates are at their present historical low.

King_Weasel

jedbo wrote: »

Hi thanks for reading this in advance.
My partner and I have around £30,000 in liquid cash at the mo. I want to put some (around 20k) of it into isas.

Before deciding how much to put into ISAs you need to answer more basic questions, like:

* do I want to take any risks with any of the money in the hope (but not guarantee) of getting a higher return?

* how likely am I to need cash at short notice?

ISAs are just a tax-free "wrapper" round your savings or investments. Probably a good idea, but not necessarily if, for instance, you can get higher (net) interest on savings outside an ISA. (For instance, a First Direct regular saver pays 8% and a Lloyds Vantage (instant access) pays 4% on a minimum balance of £5K.)