Cash ISAs: The Best Currently Available List

louiseadav

Kazza242 wrote: »

Hi louiseadav. Possibly, it is hard to tell because we are still only in early March.



Some suppliers tend to launch the better new ISAs towards the end of the tax year, to entice the savers who have yet to use up their ISA allowance and have only weeks to do so before they lose it. The rates of interest available on ISAs towards the end of March/early April tend to be higher than at other times of the year. There is then usually another set of ISAs that are launched for the new tax year only. They have tended to offer rates as high as those offered weeks before (and sometimes higher).

This year may be different (though no one knows for sure yet) because of the government's Funding for Lending Scheme, which has given providers access to cheap state-backed funding for the purpose of lending. As a result, providers have not needed to rely upon attracting savers' cash, which has contributed to the low interest rates on savings accounts and ISAs etc.



As you haven't yet used up your allowance for 2012/13, then it may be better to wait a few more weeks to see what will be available then. We still haven't got any information on what the big players are going to be offering in the coming weeks.

Some of the best rates (on offer towards the end of the tax year) do not accept transfers in, so you can benefit by depositing your unused allowance. Some of them will also allow you to deposit next year's allowance (from 6th April) into the same ISA too.

I wouldn't leave it too late though as you don't want to miss out on using up your 2012/13 allowance.

Many thanks Kazza; I'll wait a bit longer then but make sure I get my allowance in in time :-)

Rhibrown

Hi Kazza,

Please can you help me!? This stuff all really confuses me!

I opened an ISA saver online which was 3% interest I opened it in Feb 09. I dont use it to its best potential as i put money in and take it out a lot! Now it has stopped letting me put money in and im not sure why. i guess because over the years i have reached the allowance?

Could you advise me of what to do with it now? shall I open another one? I would like to start saving wisely. However i dont think I could have a fixed saver incase i ever need some money for emergency.

Thank you for your knowledge!!

Consumerist

Rhibrown wrote: »

. . . I opened an ISA saver online which was 3% interest I opened it in Feb 09. I dont use it to its best potential as i put money in and take it out a lot! Now it has stopped letting me put money in and im not sure why. i guess because over the years i have reached the allowance? . . .

It sounds as though you have indeed used all of your current year's allowance if the bank has stopped you adding more money. The problem is your allowance counts only the money you put in and completely disregards your withdrawals.

If you have used all this year's allowance, you will now have to wait until 6 April when you get a new allowance (£5,760 for 2013/14). You will get a new allowance each year when you can then add to your current ISA or open another ISA with the same or a different bank. If you have had this ISA since Feb 09, it is more than likely you could get a better rate in a new ISA.

Try to restrict deposits in an ISA to amounts you are not likely to need access to - once you withdraw money from an ISA you cannot put it back in the same tax year. Try using an ordinary savings account for money you might need access to and then tip any accumulated excess into the ISA from time to time.

Rhibrown

Hi

Thats really helpful thank you so much.

curlygirl1971

Rhibrown wrote: »

Hi Kazza,

Please can you help me!? This stuff all really confuses me!

I opened an ISA saver online which was 3% interest I opened it in Feb 09. I dont use it to its best potential as i put money in and take it out a lot! Now it has stopped letting me put money in and im not sure why. i guess because over the years i have reached the allowance?

Could you advise me of what to do with it now? shall I open another one? I would like to start saving wisely. However i dont think I could have a fixed saver incase i ever need some money for emergency.

Thank you for your knowledge!!

As Consumerist has said you have a yearly deposit limit. The tax year starts on 6th April every year and finishes on 5th April. Here are the deposit limits for the past few years and the next tax year.

2008 - 2009 £3600
2009 - 2010 £3600
2010 - 2011 £5100
2011 - 2012 £5340
2012 - 2013 £5640
2013 - 2014 £5760

So for this current tax year ending on 5th April you should have deposited no more than £5640 new money in the account. Any withdrawls are excluded from consideration.

You would be best not relying on your bank to keep track of whether you have reached your limit or not.....incase they make a mistake.

With regards to your current ISA Account, if it was 3% when you opened it in Feb 09 then it is extremely likely that the interest rate is now more like 0.10%. Find out what rate you are earning on it and then take a look at Kazza's first post on this thread for information on the best rates currently available.

Decide whether you will need access to all the money and either select a variable rate ISA (that you can add to or withdraw from) and/or a fixed rate ISA (that you can't touch for a defined term). Some ISA's only take new money - they don't accept transfers from existing ISA accounts.

If you need access to some but not all of your ISA money, you could actually have more than one account if you wish. For example, I have an account that is Instant access but I also have some others that are fixed term. I have and Instant access for an emergency only - I have a normal Savings account for month to month saving and dipping in.

Just remember that you can only pay 'new' money into 1 ISA account in any tax year.

Don't withdraw the cash yourself, rather find the account(s) you want, apply and the new ISA Provider will take care of everything ensuring that the tax-free status will remain on your pot of cash. If you withdraw the cash you'll loose the tax free status and will have to start again.

Gadfium

curlygirl1971 wrote: »

Just remember that you can only pay 'new' money into 1 ISA account in any tax year.

Pedantic hat on>
You can have a new cash and a new S&S ISA in the same year and pay money into both, as long as the total limits aren't exceeded

Consumerist

Picking up on the point made by curlygirl earlier

curlygirl1971 wrote: »

With regards to your current ISA Account, if it was 3% when you opened it in Feb 09 then it is extremely likely that the interest rate is now more like 0.10%. Find out what rate you are earning on it and then take a look at Kazza's first post on this thread for information on the best rates currently available.

Although you can't open a new cash ISA until 6 April, there is nothing to stop you transferring your existing ISA to another bank to get a better rate than you are currently getting.

If you decide to transfer, as culygirl has said, make sure you ask the new bank for an ISA transfer form, return the completed form to the new bank and let them arrange the transfer. DON'T WITHDRAW the money from the ISA to transfer it yourself or you'll lose the tax-free status on the money.

If you don't mind a postal account, you might want to consider the Cheshire BS ISA Saver Issue 1 which is currently offering 2.5%pa (if you transfer £1,000+). I don't know whether it will suit your needs but it's just a suggestion.

Withdrawals from postal accounts take a bit longer than electronic transfers but might discourage you from making them unnecessarily. You can both apply and download a transfer form online.

purplestar133

jonmcclelland wrote: »

My situation is the latter so that is what I'll do.

I'll look into going into the new Flex account at NW. I'm applying for a clarity credit card very soon for my May holiday, so I don't want to apply for too much too soon so this might be something I'll look into doing in April.

Good advice guys.

I have also applied for the Halifax clarity credit card in the last week or two and am really keen to get the Nationwide flex direct open before they pull it, how long should I wait before applying to avoid it looking like too many applications too soon on my credit record?

tesuhoha

Hi

I've got an ISA with Barclays. Its the Golden ISA Issue 3 which I opened in 2011. The balance at present is £5614 and according to the website the interest rate is 2.2%. I am getting around £9 per month interest. I have the option to transfer this to a new Barclays ISA but the interest rate offered is 2.10% I think. I am not sure what to do. Will the interest rate of my current ISA drop after April? If I transfer will I be able to add to the savings. I don't really understand ISAs to be honest. If I keep the money in the same account will I be able to add to that?

Consumerist

tesuhoha wrote: »

I've got an ISA with Barclays. Its the Golden ISA Issue 3 which I opened in 2011. The balance at present is £5614 and according to the website the interest rate is 2.2%. I am getting around £9 per month interest. I have the option to transfer this to a new Barclays ISA but the interest rate offered is 2.10% I think. I am not sure what to do. Will the interest rate of my current ISA drop after April? If I transfer will I be able to add to the savings. I don't really understand ISAs to be honest. If I keep the money in the same account will I be able to add to that?

According to <Barclays website> the current rate on the Golden ISA issue 3 is 2.22% so transferring to another ISA paying 2.10% doesn't seem a sensible option at this point.

I'm not sure but it looks like Barclays won't allow a transfer between its own ISAs anyway.

£9 pm interest on £5,614 is consistent with a rate of 1.94% pa and £10 pm is consistent with 2.16% pa so allowing for rounding errors you are probably getting the 2.22% shown on the website.

I'd say the evidence suggests you should stay put for the moment.

Edit
It's a variable-rate ISA so the interest rate could change at any time at all but there is no reason why it should change in April.

If you transfer the ISA, you will be able to add to it (up to £5,640 in this tax year) after the transfer. If you add to it after 5 April then you won't be able to open a new one for 2013/14 but you will able to transfer the current one.