Excuse my ignorance, but...

Donkeytrousers_2

If we adhere to the rule..."Never, ever, ever, ever withdraw money from a cash ISA!
You'll immediately lose all the tax benefits."

...how do we ever get at any of our savings?

Lokolo

There are exceptions to every rule....

le_loup

Donkeytrousers wrote: »

You'll immediately lose all the tax benefits

Not true.
You lose the future tax benefits, not those you have accrued.

Funkyfreddy

Donkeytrousers wrote: »

If we adhere to the rule..."Never, ever, ever, ever withdraw money from a cash ISA!
You'll immediately lose all the tax benefits."

...how do we ever get at any of our savings?

Obviosuly if you wish to make use of your capital and any accured interest you would make a withdrawal. Be careful though with any specific T&C as to any loss of interest if you are making a withdrawal within a an initial fixed term or bonus period.

You are perhaps though confusing the above "rule" when you are transferring from one ISA to another.

Never, never, never, ever wirhtdraw money from a cash ISA to deposit in a new (more attractive % rate) Cash ISA - always follow the correct transfer rocess otherwise you will loose all the future tax benefits and only be able to deposit your curret tax year allowance.

FF

gadgetmind

I've always viewed cash ISAs (and cash deposits in general) as second-stage emergency funds to draw in when the first layer (instant access or close) cash has been exhausted. If you haven't lost your job, or had a similar "black swan" event, then such funds should always remain intact.

bigfreddiel

Donkeytrousers wrote: »

If we adhere to the rule..."Never, ever, ever, ever withdraw money from a cash ISA!
You'll immediately lose all the tax benefits."

...how do we ever get at any of our savings?

Well what you do is spend non-ISA money at the same rate the ISA money is increasing from interest - at some time or other non-ISA money will run out - then you dip into the ISA money.

The good thing about rules is that they can be broken!

DavidHayton

Any money that I do not intend to withdraw in the next ten years is not in cash ISAs!

I use cash ISAs for medium term stuff like saving up for next year's foreign holiday, so I sure will withdraw it then.

What I do not do is use a cash ISA for short term savings such as holding the funds that I plan to use to clear the credit card at the end of the month.

Best wishes
David

bigfreddiel

DavidHayton wrote: »

Any money that I do not intend to withdraw in the next ten years is not in cash ISAs!

I use cash ISAs for medium term stuff like saving up for next year's foreign holiday, so I sure will withdraw it then.

What I do not do is use a cash ISA for short term savings such as holding the funds that I plan to use to clear the credit card at the end of the month.

Best wishes
David

hmmmm....
Para 1 - if you do not intend to withdraw in the next ten years i guess you have it in an S&S ISA - thats good - long term

Para 2 - using cash ISAs to save for a holiday next year - not a good use of your tax free allowance - this is short term saving

Para 3 - paying monthly bills - thats just current account - get one that pays a high rate of interest for amounts up £2.5K or some other ridicuously small amount

to summarise - build up your ISAs (S&S and cash) - in 10-20 years time you'll be glad to have a sizable sum earning tax free money for you - mine now pays for my foreign holidays each year!

spikyone

bigfreddiel wrote: »

Para 2 - using cash ISAs to save for a holiday next year - not a good use of your tax free allowance - this is short term saving

The post specifically mentions next year's holiday - in which case he may as well use his ISA allowance for this year and put any overspill into an instant access savings account. He would then use the savings account in preference to the ISA to pay for the holiday, but it wouldn't really matter if he withdrew from this year's ISA allowance.
As long as you don't plan to withdraw from an ISA in the current tax year, it's usually the best place for short-ish term savings. Once the tax year changes, it wouldn't make sense to pay into next year's allowance until the holiday is paid for, to avoid withdrawing from the ISA if possible.

Rich1976

bigfreddiel wrote: »

hmmmm....
Para 1 - if you do not intend to withdraw in the next ten years i guess you have it in an S&S ISA - thats good - long term

Para 2 - using cash ISAs to save for a holiday next year - not a good use of your tax free allowance - this is short term saving

Para 3 - paying monthly bills - thats just current account - get one that pays a high rate of interest for amounts up £2.5K or some other ridicuously small amount

to summarise - build up your ISAs (S&S and cash) - in 10-20 years time you'll be glad to have a sizable sum earning tax free money for you - mine now pays for my foreign holidays each year!

However not everyone has enough spare cash to max out Cash Isa's, let alone putting any spare in normal savings accounts. I consider myself to be quite savvy with money matters however the salary that I am on ( a few thousand short of the supposed national average ), less household bills, less pension contributions etc mean that I 'only' have £250-£300 left to save. To me it makes sense to put this into a cash Isa because provided I choose one that pays as near to the best interest as possible I am earning more than a bog standard account. This £300 pm pays my annual car insurance, car tax, servicing and the annual holiday.

bendix

Donkeytrousers wrote: »

If we adhere to the rule..."Never, ever, ever, ever withdraw money from a cash ISA!
You'll immediately lose all the tax benefits."

...how do we ever get at any of our savings?

Oh for the love of God.

Seriously?