transfer money from ISA to NS&I

blairie

My ISA is coming to an end early August, so the interest rate will drop to virtually nill.
Would it be better to open a new cash ISA, say Halifax 2 year fixed rate, for 3.65% - or is it possible to get transfer the money from the ISA into to NS&I inflation linked bond?
Or is tranferring to a "new" 3% Halifax one year ISA better?
Which one do you guys think is the better option.
I have read all the material online but just can't make up my mind.

Your advice would be much appreciated.

Blairie

Reaper

The NS&I product is great because it removes uncertainty. However if you plan to put the maximum into your cash ISAs each year there is an argument for sticking with them because once you remove the money you can't put it back in, and maybe their performance will be better in the future. You will have to decide based on your savings plans.

If you do decide to stick to ISAs then you can do better with the Coventry 5 year 5% offer. Although it is 5 year you can withdraw it early for a penalty. The effect of the penalty on your return I have shamelessly nicked from another post:

Effectively that's a return of 3.33% for 1yr, 4.16% for 2yr, 4.44% for 3yr, 4.58% for 4yr or 5% for 5 yrs.

Ark_Welder

If you are interested in inflation-linked products, and if it is still available, then KRBS have an inflation-linked cash ISA that might be of interest. The current issue may have closed by the time your ISA has matured, but they could also issue another - although the terms may be different. But unlike NS&I, you must keep the investment going for the full 5-year term.

To move the ISA into NS&I index-linked certificates you would need to take the cash out of the ISA at maturity and then buy the certificates. There is no method to directly transfer your cash. Should you subsequently want to move the proceeds from NS&I back into a cash ISA then you would be unable to put in more than the annual contribution limit for cash ISAs that is in force at that time.

blairie

Thanks for your advice Ark Welder and Reaper, much appreciated.

Blairie