ISA or Regular Saver?

Deru

DeanMB wrote: »

First of all, what do they mean by "may"? Either I will, or I won't, right?

Secondly, could I transfer £300 from a separate account into this account before moving it into the saver? Combining this with my wage of £750, I'll be hitting the £1000 threshold, right?

Yes, you can transfer £300 from a separate account to hit the £1000 to not pay £10 the fee. I think you need it from an account outside of First Direct and not an internal transfer.

It's a "may" because you are waived from the £10 fee if you have any other savings account with First Direct, even if you do not pay in £1000 in any given month. I have a savings account with them and I keep £1 in it. My Regular Saver matured last month and I got £123.93 interest credited.

As mentioned, ISA is better in the long run unless you're looking to spend the money after a year. Be aware though that if you withdraw from the Regular Saver before maturity, you lose all interest earned as they only pay it upon maturity.

DeanMB

Masomnia wrote: »

Sorry yeah I edited my post, if you pay tax on your wage you'll be paying tax on savings too, you'll get 4.8% annually from the regular saver.

I reckon in that case you may as well stick with the ISA. Especially if you may need to withdraw the money, and you lose this year's allowance.

Okay, thank you for your help - I'll just have to look for a better ISA I guess

innovate

Don't give up on the FD Reg Saver, it's a great little savings account. I just opened my 5th (one max a year). You can also bag £100 for opening the pre-req FD Current Account if you play your cards right. Have a read about to find out more.

There are also other accounts that may be of interest to you - - e.g. a Nationwide FlexDirect pays 5% AER on up to £5K for 12 months. It might be possible to bag another £70 via Quidco/TCB for applying for that account.

Then there are the "regular" current accounts, 123 and Lloyds/BOS Vantage, that currently pay up to 2.4% net after BR tax if certain conditions have been met. Again, plenty more details about these on here, and on the banks' websites.

DeanMB

innovate wrote: »

Don't give up on the FD Reg Saver, it's a great little savings account. I just opened my 5th (one max a year). You can also bag £100 for opening the pre-req FD Current Account if you play your cards right. Have a read about to find out more.

There are also other accounts that may be of interest to you - - e.g. a Nationwide FlexDirect pays 5% AER on up to £5K for 12 months. It might be possible to bag another £70 via Quidco/TCB for applying for that account.

Then there are the "regular" current accounts, 123 and Lloyds/BOS Vantage, that currently pay up to 2.4% net after BR tax if certain conditions have been met. Again, plenty more details about these on here, and on the banks' websites.

So with accounts like the FlexDirect am I open to be taxed on that balance? With it being a current account rather than a savings account would the rules be different? It definitely seems worthwhile opening if not.

badger09

innovate wrote: »

Don't give up on the FD Reg Saver, it's a great little savings account. I just opened my 5th (one max a year). You can also bag £100 for opening the pre-req FD Current Account if you play your cards right. Have a read about to find out more.

There are also other accounts that may be of interest to you - - e.g. a Nationwide FlexDirect pays 5% AER on up to £5K for 12 months. It might be possible to bag another £70 via Quidco/TCB for applying for that account.

Then there are the "regular" current accounts, 123 and Lloyds/BOS Vantage, that currently pay up to 2.4% net after BR tax if certain conditions have been met. Again, plenty more details about these on here, and on the banks' websites.

Just to clarify its 5% on balance up to £2500, not £5k. Some posters have multiple accounts, but Nationwide only 'guarantee' 5% on 1 account.

DeanMB wrote: »

So with accounts like the FlexDirect am I open to be taxed on that balance? With it being a current account rather than a savings account would the rules be different? It definitely seems worthwhile opening if not.

Same tax rules apply whether savings or current account. The interest will be taxed at 20% at source (ie by the bank), unless you sign a declaration saying you are not liable to pay tax.

DeanMB

badger09 wrote: »

Just to clarify its 5% on balance up to £2500, not £5k. Some posters have multiple accounts, but Nationwide only 'guarantee' 5% on 1 account.



Same tax rules apply whether savings or current account. The interest will be taxed at 20% at source (ie by the bank), unless you sign a declaration saying you are not liable to pay tax.

So just to clarify, if I were to deposit £2,500 and leave it there for two years I would earn 5% on this, earning me £125. Of this, 20% would be tax, netting me £100 growth on £2,500?

By that logic, I would be better splitting my cash up and filling this 5% limit and putting the rest into an ISA with a better rate?

badger09

DeanMB wrote: »

So just to clarify, if I were to deposit £2,500 and leave it there for two years I would earn 5% on this, earning me £125. Of this, 20% would be tax, netting me £100 growth on £2,500?

By that logic, I would be better splitting my cash up and filling this 5% limit and putting the rest into an ISA with a better rate?

If only it were that easy

Ist of all, you can't just deposit £2500 and leave it there for 2 years because:
1) the FlexDirect has funding requirements of £1k per month (which you can simply pay in and then out again )
2) that 5% rate is only for 12 months

But it would get you net interest of £100 for that year:)

DeanMB

badger09 wrote: »

If only it were that easy

Ist of all, you can't just deposit £2500 and leave it there for 2 years because:
1) the FlexDirect has funding requirements of £1k per month (which you can simply pay in and then out again )
2) that 5% rate is only for 12 months

But it would get you net interest of £100 for that year:)

I missed that £1k per month policy! Oops.

You can tell I'm tired as I put two years when I did mean one I even worked it out for one year!

Right, so let me run this past you and see if I'm understanding it right.

I can take my whole £3.5k and deposit it into my normal current account. From there I need to fill the allowance with £2.5k, leaving me with £1k left over, with which I need to keep transferring in and out of my Nationwide current account to keep the account active?

atush

Use the Reg saver to save monthly to fill NEXT year's ISA?

DeanMB

atush wrote: »

Use the Reg saver to save monthly to fill NEXT year's ISA?

COuld you explain a bit?

I'd surely be better off filling the isa this year if I were to do that?

The point I was getting at with this thread was whether I can accumulate more interest with a saver than an isa