new accounts

bzc

Hi If you open an isa that has a bonus rate for so long does the variable rate still go up or down but you still get the guaranteed bonus rate.


also some sites ive seen advertise the same account with the same companies but described different...some say MIN DEPOSIT others call it MIN BALANCE. are these the same just worded differently by the site.

does this mean you need to keep the balance at that figure to get the bonus rate,what would you get if dropped below

Thanks

psychic_teabag

Sometimes the bonus rate is fixed, sometimes it is also variable. In practise, they rarely seem to change over the first year.

"Min (Operating) Balance" and "Min (opening) deposit" are slightly different. There was one account around recently with a min opening deposit of £1000, but min balance of £1, so you could open with £1000 then immediately withdraw £999

Sometimes the min balance isn't strictly a minimum, but they just give a reduced interest rate if you fall below it. Basically, you need to read the account T&C to see what penalty might befall you if you go below the minimum balance. Might be immediate closure. Or you might lose the bonus.

bzc

Ah right thanks Psychic clears it up a bit.

so looking at the santander one for example, taken from their site

This rate Includes a 2.80% tax free/AER variable bonus for the first 12 months.

means you might not get that rate for a full year?

it also says ...

Account balance can drop below £2,500 and be eligible for the above variable rate bonus.

so does that mean you may still get the bonus rate?

psychic_teabag

Looks that way - the interest rate table shows the rate for balances of £1 or more, suggesting that while the min opening deposit is £2500, the min operating balance is just £1.

Both the underlying rate and the bonus are variable, and could change at any time. They're supposed to tell if if there are significant changes, but can do so with notices in branch, or in the press. They don't have to write to you personally.

Sounds like you hope to deposit £2500 then withdraw some. Are you aware that would consume some of your annual allowance ?