Nationwide fixed rate ISA bond at 5.85%?

Buster_Danog

Is this account as good a deal as the NS&I direct ISA? I can put £3,000 in without needing to access the money, but I read on this site that the NS&I is guaranteed to be above the base rate until 2008. The Nationwide one says "Rates on the one and two year Fixed Rate ISA Bonds may be withdrawn without notice."

There is some info about the Nationwide fixed rate ISA bond here at the bottom http://www.nationwide.co.uk/mediacentre/PressRelease_this.asp?ID=952

Also, with the NS&I direct ISA can I have more than £3,000 in it. Could I put 3k in before 5th April then another £1,000 in after that date and get 5.8% on £4,000??

Cannon_Fodder

Depends if you think rates will go up further...

Being a Fixed Rate, the Nationwide one won't change until maturity. NS&I's will stay 0.55% above the Bank base rate, so if rates change upwards it will beat the Nationwide. If rates go down, the Nationwide would be a good option, apart from...

...Have you seen the Newcastle offering http://online.newcastle.co.uk/invest/ISA2007/IndexISA2007.htm.html?webabacus_id=1171376674320-1 ?? 6.1% is a step ahead of the next rate rise - it would take 2 for NS&I to overtake it...the down-side is 60 days loss of interest if you need the money unexpectedly, so only good for money you REALLY don't need to touch.

Buster_Danog

So that Newcastle one looks like the best deal then, but they are saying it might be withdrawn soon so I better be quick. Errr, I don't know if rates are going to change right now.

And does anyone know if the NS&I or others allow more than 3k in if you are putting two years allowance in.

Cannon_Fodder

Rate changes - no-one knows, thats the problem...inflation dipped this week, but was it enough? Gas prices dropping will help further, but something else could shoot up unexpectedly...

Sorry, forgot to answer your last question...Yes, you can put more than £3000 in, as long as its across multiple tax years. Its just a tax-year limit...so the way you described it is perfect. And keep adding, if you can, so another £2000 (in addition to the quick £1000) would make up the £3000 limit for the 2007/8 tax year...

And of course, always opt for interest to be added to the account (some offer it as a monthly income, paying interest to a normal account) then the interest will earn tax-free interest...

Interest is calculated on a daily basis, so the earlier in April, the 6th!, the better...

Buster_Danog

Cannon_Fodder wrote:

...Have you seen the Newcastle offering http://online.newcastle.co.uk/invest/ISA2007/IndexISA2007.htm.html?webabacus_id=1171376674320-1 ?? 6.1% is a step ahead of the next rate rise - it would take 2 for NS&I to overtake it...the down-side is 60 days loss of interest if you need the money unexpectedly, so only good for money you REALLY don't need to touch.

Just to clarify, Cannon, does the above still hold true even though the Newcastle ISA takes 20 months to mature?

neetugopal

Franco78, I checked with NS&I in October regarding transferring ISA money from previous years and they said "NO". So the maximum you can put is £3000.

Cannon_Fodder

Franco78 wrote:

Just to clarify, Cannon, does the above still hold true even though the Newcastle ISA takes 20 months to mature?

Well that's a judgement call for everyone to make...will rates go more than 2 steps up in 18 months...possibly...or could they go up another 0.25% and then either drop back again or hold steady, in the same time period...possibly...

If you don't need the money for 20 months, its not a bad option...

Another recent candidate is A&L, 7%, if you want to move to their current account, just to confuse matters...although they've annoyed a lot of existing customers with their "brand new customers only" approach of late.

Cannon_Fodder

neetugopal wrote:

Franco78, I checked with NS&I in October regarding transferring ISA money from previous years and they said "NO". So the maximum you can put is £3000.

While you are correct about no-transfers-in to NS&I and that only £3000 can be put in during a tax year, the fact that we are in February means that Franco can put £3000 in this month, then another £3000, or part thereof, after April 6th...to have (upto) a full £6000 earning 5.8% for the 2007/8 tax year.

...subject to his decision about other options - A&L, Newcastle, Nationwide???!!!

Buster_Danog

Thanks Cannon and Neet. I'll be putting some of my mum's money in, so it looks like £3,000 into the Newcastle before they stop that offer, and another £3,000 into the NS&I. The current account offer isn't really suitable for me or my mum. Thanks again for the advice. :T

nilocmac

I opened one of these about 2 weeks ago well actually I transferred my members ISA bond into a 1 yr fixed ISA bond. I wasn't asked for my previous bond certificate the lady said it didn't matter. Then last week I left my OH's application in and was asked for her bond certificate I mentioned I hadn't need it when I opened mine. So after a little consulatation with another staff member she said I was right it didn't matter. However the next problem arose when we could not see it online. So I went into the branch and no one could find my wife's appilcation although on lady remember taking it off me.

So I go in again and get a new application and get my OH to fill it out and leave it in today but am met by a member of staff who is insistant that I need to previous bond cert. I explain the above and she goes into the back and says she has talked to a manager and i do need it. So out I go again to get the bond cert. Tis frustrating that not all the staff agree on whether or not you need the old cert. I am disappointed that my OH has lost out 0.4% for a week or so now (ok it not that much but the principle is there).

So has anyone else opened one of these accounts by transferring for a members ISA bond? And did they need their original cert?

jackthelad_2

So has anyone else opened one of these accounts by transferring a members ISA bond? And did they need their original cert?

I have, I didn't have by cert with me they said no problem!, recieved new fixed rate ISA cert in post a few days later. Was told this years interest will be added to bond in april