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Abbey Special Edition Choices ISA

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Posts: 4,265 Forumite

Been looking for a new ISA after the IF ISA interest rate went down. Have had a look at the Abbey Special Edition Choices ISA which is offering an interest rate of 5.5% fixed for one year. It seems like a good deal, you can transfer other year's ISA's across.
However there seem to be a few downsides:
- Interest earnt on the ISA must be paid into another account (i.e. non ISA)
- You can only make one deposit
Has anyone else had any dealings / insights into this ISA?
Basically is it a good deal?
Thanks
http://www.abbey.com/future/taxeff/savings_isas/savings_isas_choises_isa.html
However there seem to be a few downsides:
- Interest earnt on the ISA must be paid into another account (i.e. non ISA)
- You can only make one deposit
Has anyone else had any dealings / insights into this ISA?
Basically is it a good deal?
Thanks
http://www.abbey.com/future/taxeff/savings_isas/savings_isas_choises_isa.html
"An eye for an eye leaves the whole world blind" - Mahatma Gandhi
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Comments
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Depending on your view of the likely movements of interest rates over the next 12 months, it seems like a good deal for most people that don't need access to their ISA cash. 5.5% is a significant premium over A+L 5.4% and the normal Abbey postal rate of 5.35%, but it interest rates go up in the next 12 months a variable rate might rise above the fixed rate.
Plus points are no exit penalty like for A+L, big transfers allowed in unlike First Direct's 6.25% (for 8months) offer. Downside is Interest is not re-credited to the account, so would not remain within the tax-free wrapper of an ISA. Not so important for accounts with £3k in it but significant if you are looking to transfer all your cash ISAs from the last 5 years in.
Not sure if you can open it with a transfer if you've already used up your 2004/5 allowance, but there's no harm in asking! I'm contemplating a switch from M&S to Abbey but would probably opt for the Postal ISA because it keeps the interest within the tax-free wrapper.Cider Country Solar PV generator: 3.7kWp Enfinity system on unshaded SE (-36deg azimuth) & 45deg roof0 -
Its a poor excuse for a 1 year fixed rate bond... The business about the cannot add interest to the ISA switches me off...0
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Cheers for the imput. I'll be putting in two years worth of ISA (+ interest). Worth it or not such a good deal? I guess then the Abbey Postal ISA would probably be the best bet?"An eye for an eye leaves the whole world blind" - Mahatma Gandhi0
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Doesn't Abbey's postal ISA guarantee to pay BOE base rate + 0.5% expire next month? Does anyone know if they've extended the guarantee or launched a new one?
If they haven't extended the guarantee or announced a new one, then what's to stop them dropping the interest rate once the guarantee expires?Please call me 'Kazza'.0 -
i dont believe the guarantee has been extended yet but ill double check at work tomorrow0
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yeah as i thought there is no announcement yet as to whether the rate will be dropped or the guarantee extended.
i cant see it dropping to be honest though. the hassle we had at laucnh of the postal isa was a nightmare and i cant see them alienating all those customer a second time in 5 months.
if i was a gambling man (and i am!) my money would be on the rate guarantee being extended (at least for the short term)
(it should be noted here that im not a very good gambler)
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davidcampbell - Thanks for the info
. If they do extend the guarantee, then I may be tempted to open an Abbey 2005/06 ISA.
Please call me 'Kazza'.0 -
I think I'll leave my money in IF and see what happens after April 1 to see if they extend their guarantee, thanks again."An eye for an eye leaves the whole world blind" - Mahatma Gandhi0
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