Advice Needed Please

Valo

Hi Everyone,

I’ve received a letter through from Bank of Scotland to say that my ISA Direct Reward rate (3.00%) will be reduced on 11/04/2012 to their standard rate of 0.50% AER/Gross p.a variable.

I currently have about £1000 in my ISA and add £100 per month, this will go up this coming financial year. I like everyone want to maximise my interest while still having access to my savings in case of aminor financial emergency.

What ISA product should I be looking at to help me achieve this goal?

xylophone

After 6 April, open an instant access ISA that allows transfers in.

blueberrypie

You will probably want a variable-rate ISA - most fixed-rate ISAs only allow for one lump sum subscription at opening and no further deposits (although there are exceptions).

You might want to consider putting part of your ISA savings into a fixed-rate ISA (for higher interest) and part into a variable rate ISA (for easy access). Once the new tax year starts, and the £1k you have already saved is no longer "current year", you can split it up however you want. You can also transfer part (or all) of your current ISA savings into another ISA and then top that up with your £100/month.

Valo

Thanks for the information. What would be the best instant access ISA product to look at to replace my current ISA?

blueberrypie

There's a list of currently-available cash ISAs at https://forums.moneysavingexpert.com/discussion/401374 - they're sorted by whether or not they allow transfers in, what the fixed term is if there is one, etc.

evenasus

This easy access ISA @ 3.10% from Nationwide should suit your purpose. http://www.nationwide.co.uk/savings/cash_isa/onlineisa/default.htm

They pay interest from the day they receive your application.

Valo

evenasus wrote: »

This easy access ISA @ 3.10% from Nationwide should suit your purpose.

They pay interest from the day they receive your application.

If I wanted to go-ahead and transfer my existing ISA to the Nationwide, when should I do this? My existing ISA (Halifax Direct Reward 4) introduction rate (3.0% with 0.2% reward as I have a reward current account) ends on 11/04/2012.

Should I open the new ISA now and start the transfer process or wait until after the 11/04 next month to make sure I receive my interest on the invested funds ok?

Vortigern

Valo wrote: »

I currently have about £1000 in my ISA and add £100 per month...

Valo wrote: »

Should I open the new ISA now and start the transfer process or wait until after the 11/04 next month to make sure I receive my interest on the invested funds ok?

If you've had £1000 in the ISA for the full 12 months, the 0.2% reward will be £2. This is the most you could lose by transferring too soon. The 3% interest will be credited to the account and transferred to your new ISA regardless of date of transfer.