Santander 3.3%/3.5% Flexible ISA i3

Derivative

MSE wrote:

The Flexible ISA (issue 3) from Santander* currently pays 3.15% AER, but from this Fri (11 March) the rate will be increasing to 3.3% AER, and guarantee to be 2.8% above base rate (currently 0.5%) for a year. You can apply online, in branches or by phone.

Details on the MSE site. Interesting to see a war of sorts breaking out.

bruirn

After having a A&L Flexible ISA last year I'm starting to doubt my decision to switch to Halifax. The new Santander rate looks good especially as the link to the BOE interest rate. Too late to cancel it?

jimbow25

If you're transferring somewhere you could transfer back I suppose.

But remember, this ISA doesn't accept transfers in!!
Not even from other Santander ISAs.

ilsonreject

New to all this stuff (never had any money before to worry about where to best put it )

In the past experience of you guys, does a "bidding war" tend to heat up closer and closer to April 5th? I'm gonna open my first ISA account and this looks a fair deal (esp as I'm with Santander anyway so I assume will be quick and easy to set up) but dont want to sign up now and have a better deal come along in a few days time.

How late can I leave it? I know the deadline is April 5th but how long does it generally take for the application process?

Sorry for the newbie questions

jimbow25

What you are seeing at the moment is the bidding war. Last year Santander and Barclays both brought out the top 2 rate ISAs for new money (Santander's was higher). Santander's "out-bidding" this year is already more fierce activity than last year, personally I wouldn't expect either to increase their rates any more before 5th April and 3.3% or 3.35% may well be this year's top offer.

I wouldn't leave it too late, especially if you are not already a customer of the bank as they will want to do ID checks etc and then the payment has to arrive by 5th April (does the account you have the money in let you make faster payments? Do you bank online or would you have to visit the bank to make the transfer?). I'd probably start applying no later than a week's time but that's me being cautious.

Think about how much difference another 0.1 or 0.2% interest would make over the year to you as well!! If it's only a few pounds you may as well just go for it now.

JulieElizabeth

I was in Santander this afternoon and was told the their Flexible ISA is going up to 3.5 on Monday

Just saying

Lokolo_2

JulieElizabeth wrote: »

I was in Santander this afternoon and was told the their Flexible ISA is going up to 3.5 on Monday

Just saying

That is only for existing customers who meet certain conditions

Santander wrote:

You already qualify for this great rate if your current account is with us and you pay in at least £1,000 a month, or you have a Santander mortgage or investment subject to the qualifying criteria below
You switch your current account to Santander using our dedicated switching service and agree to pay £1,000 each month

Jackie47

I was in Santander this afternoon too and was told that it went up today...3.5 for non-customers and 3.7 for customers with no strings!

Went into Barclays straight after to be told the Santander ISA does have strings so who to believe? :rotfl:

ilsonreject

jimbow25 wrote: »

What you are seeing at the moment is the bidding war. Last year Santander and Barclays both brought out the top 2 rate ISAs for new money (Santander's was higher). Santander's "out-bidding" this year is already more fierce activity than last year, personally I wouldn't expect either to increase their rates any more before 5th April and 3.3% or 3.35% may well be this year's top offer.

I wouldn't leave it too late, especially if you are not already a customer of the bank as they will want to do ID checks etc and then the payment has to arrive by 5th April (does the account you have the money in let you make faster payments? Do you bank online or would you have to visit the bank to make the transfer?). I'd probably start applying no later than a week's time but that's me being cautious.

Think about how much difference another 0.1 or 0.2% interest would make over the year to you as well!! If it's only a few pounds you may as well just go for it now.

Thanks for the reply.

Can I just double check my understanding of ISA's is correct.

So if I open one of the 3.5% accounts sometime next week (I'm already a Santander customer and pay in 1k+ per month) I can deposit £5,100 next week and then another £5,300 on April 6th and I'll earn 3.5% on the whole £10,400 which would mean £364 profit this time next year? (or possibly a bit more if interest rates go up)

Come April 6th next year the rate will drop to a much lower rate so I should shop around for a new account right? Then I transfer the £10,764 I've got in Santander into this new account plus I add in another £5300 (or whatever it is next year) meaning I've now got £16,064 in there and if it's say another 3.5% rate that would earn me £562 interest leaving me with £16,626 to do the same thing next year and so on and so on?

Have I got that right?

Stupid question but I guess if I can put the whole lot in as early as possible it earns more interest than if I was to drip feed it in month by month? I usually get my works bonus around March time so works out good timing.

rb10

Jackie47 wrote: »

Went into Barclays straight after to be told the Santander ISA does have strings so who to believe? :rotfl:

There are no strings on the Santander ISA. The only restriction on it is that you cannot transfer existing ISAs into it (but the Barclays ISA has this same restriction).

ilsonreject wrote: »

So if I open one of the 3.5% accounts sometime next week (I'm already a Santander customer and pay in 1k+ per month) I can deposit £5,100 next week and then another £5,300 on April 6th

£5340 on April 6th.

ilsonreject wrote: »

and I'll earn 3.5% on the whole £10,400 which would mean £364 profit this time next year? (or possibly a bit more if interest rates go up)

Yes.

ilsonreject wrote: »

Come April 6th next year the rate will drop to a much lower rate

No, on the anniversary of the date that the account is opened the rate will drop.

ilsonreject wrote: »

so I should shop around for a new account right?

Yes, just looking at ISAs that accept transfers in.

ilsonreject wrote: »

Then I transfer the £10,764 I've got in Santander into this new account plus I add in another £5300 (or whatever it is next year) meaning I've now got £16,064 in there and if it's say another 3.5% rate that would earn me £562 interest leaving me with £16,626 to do the same thing next year and so on and so on?

Have I got that right?

Yes!

ilsonreject wrote: »

Stupid question but I guess if I can put the whole lot in as early as possible it earns more interest than if I was to drip feed it in month by month? I usually get my works bonus around March time so works out good timing.

That is correct. The sooner the better.

2sides2everystory

Jackie47 wrote: »

Went into Barclays straight after to be told the Santander ISA does have strings so who to believe? :rotfl:

I can think of one possible one if it has not been changed due to MSE exposure last year - the speed at which you can get your money out at the end (if that is what you want to do i.e. take out or transfer as cash and prejudice the tax-free status rather than transfer to another ISA elsewhere.)

I believe that with Barclays it can be done immediately but at Santander perhaps only immediately if you have a current account with them to which it is transferred first.

I have a Santander one from last year with £10,200 in it (plus interest) which finishes its 12 months on the 3.5% rate on 16/3. Any ideas where it might best go next and how I most efficiently get it there anyone?