What to do with my ISA?

lamialex

Hello,

I have some money that I put last year into a 1 year Fixed Rate Cash ISA with the Post Office. It's nearly the end of the 1 year contract so I was wondering what I should do with the money. I am not sure of the interest rate that the Post Office will the give me but I doubt it will be one of the top ones. So I have been thinking about transferring this money into another is account. Does that sound sensible?
I can for sure put more than half of this money locked for another year but I will probably need to access the rest very easily so I've been looking at the Santander 3.3% AER ISA account but I'm not sure about this. It's all very confusing...
On this website it says : "Once the guarantee ends it'll drop to its variable rate (currently 0.5%), so make sure you transfer to a new top provider then."
When is "once the guarantee ends"? After a year? Does Santander give you 3.3% for a whole year?
Thanks in advance for your help
Alex

ChopperST

lamialex wrote: »

Hello,

I have some money that I put last year into a 1 year Fixed Rate Cash ISA with the Post Office. It's nearly the end of the 1 year contract so I was wondering what I should do with the money. I am not sure of the interest rate that the Post Office will the give me but I doubt it will be one of the top ones. So I have been thinking about transferring this money into another is account. Does that sound sensible?
I can for sure put more than half of this money locked for another year but I will probably need to access the rest very easily so I've been looking at the Santander 3.3% AER ISA account but I'm not sure about this. It's all very confusing...
On this website it says : "Once the guarantee ends it'll drop to its variable rate (currently 0.5%), so make sure you transfer to a new top provider then."
When is "once the guarantee ends"? After a year? Does Santander give you 3.3% for a whole year?
Thanks in advance for your help
Alex

If you are looking to transfer your funds across to Santander then I dont think their product allows a transfer in. If you are looking to transfer look into the Halifax direct reward ISA at 3.2% AER which does allow transfers in. Remember not to withdraw the funds from one account and pay them into the new account as it will count against your allowance for the tax year 11/12. Open the new account and fill out a ISA transfer form. If you do that with Halifax they will back date interest to the day they recieve the form.

Of course if you arent looking to transfer funds across knock yourself out with Santander or look at another 1 - 2 year fix if you can afford to tie the money up for that peroid of time without needing access to it. (I wouldn't fix for longer than 2 years though as interests rates are likely to rise in the not too distant future).

Hope this helps.

edit - To get the 3.2% AER you need Halifax's reward current account and pay in £1000 a month but it is sufficient to just open an account and pay the money in one day and straight out again the next to qualify. (You''ll also get another £5 a month from them for doing so!)

Loughton_Monkey

It is becoming tedious for cash ISA investors these days. Almost universally, the best rates apply for 12 months only. [Almost universally 12 months from date you transfer in].

The Santander 3.3% deal is of no use to you, since it doesn't allow transfers in.

Similarly, I would point out that your requirement to extract some of it (this tax year) is a complication. You see you would have to transfer x% to some fixed rate ISA that allows transfers in, and the other (100 - x)% into an instant access account. I guess this is possible, but banks are not going to be 'excited' by this transfer - especially if you are not contributing new money this year.

It's probably best to transfer 100% to [for example sake] a Halifax instant ISA, and only when it has got there, ask them to transfer x% into one of their fixed rates.

VT82

Loughton_Monkey wrote: »

The Santander 3.3% deal is of no use to you, since it doesn't allow transfers in.

Note that this is not the case if your existing ISA is your only savings, and you won't have any more this year. If that is the case, no harm in withdrawing the maturing funds, and treating it as a new money ISA with Santander.

lamialex

Thanks for all this help, this is great!!! :j

The Halifax account seems like my best choice since it's better to transfer all my money and close my current Post Office account. I only have one ISA account and no other savings account.

Do I need to open a Reward Current Account with them to get the top rate or can I just open a Current Account to get that rate?

kidmugsy

newcastle BS have set themselves up to let you easily spread money across several different ISAs. It may be worth checking their website.

VT82

lamialex wrote: »

Do I need to open a Reward Current Account with them to get the top rate or can I just open a Current Account to get that rate?

Your Current Account should automatically be a Reward Current Account if you pay in £1,000+ per month, though do specify you are intending for this to happen when you ask to open it. It's only the Ultimate Reward Current Account that needs to be paid for. Either one would get you the higher rate.