ISA decision

mt77

Hi,

I have been reading this site for the best ISA's currently available and I am tempted to transfer my existing cash ISA I have with Natwest, to the current best buy available from Santander (Direct ISA issue 9). I would like honest opinions on whether it is worth me transferring it, and if there are any pitfalls I may not have seen....

My current ISA situation:
I have a Natwest E-ISA account which I have had since April 2009 (so currently getting pre-May 2009 rates - 3%). I have accumulated over £20,000 and have subscribed the full amount for 2011 year. By 6/7 April I will be subscribing the full cash amount for the 2012 year and will have just over £26,000. If all goes well, and I am able to subscribe the full amount again for 2013 year (without withdrawal), I will then have around £32,000/£33,000 which will then qualify me for the 3.3% interest rate with Natwest.

As you know Santander (and others) are currently offering over 3% interest, but with Santander this rate is temporary and only available for a year. Therefore, if I transfer my ISA I could start getting 3.3% for the 2012 year, but then I will have to search and hope I find another similar, or better rate elsewhere, as if I don't then I could possibly miss out on 3.3% interest on a higher balance with Natwest.

I guess this is more a question of if this is a trend happening with ISA account interest rates rising, and if it will continue into 2013? And if so, are Natwest are likely to follow suit with their E-ISA accounts?

I know there are other higher fixed rate long term ISA's available, though I am only interested in accounts which have an instant access and penalty free withdrawal system (just in case I need the money urgently -though luckily I have not had the need to withdraw any money yet, even during this recession).

Many thanks for your opinion on this.

Regard

Manish

westy22

No-one knows what rates will do later in April 2012 never mind 2013! If the crystal-ball gazers are correct then bank interest rates will be staying low in 2012 so the chances are that the current rates are as good as they will get for the next few months. 2013? - no idea.

evenasus

According to the NatWest website, their E-ISA rates includes a 1% bonus for 12 months. So the rate would drop at the end of 12 months.