Nationwide 2.5% Regular Saver ISA

phemark

Hi,

Can you clarify one thing for me please, as I am quite new with ISAs.

At the moment, I have an Online 8 ISA with Nationwide, which is 2.2%.
1) Can I continue to pay to it as normal? (But it is old ISA, cant be opened new now).

If I was to create a new Regular Saver ISA for 2.5%, it says:
"The Regular Saver Isa has a fixed term until 31 March 2015, after which the money will be transferred into the Society’s instant Isa saver. This currently pays 1.5 per cent."
2) Would I need to then transfer all the money to a better ISA than 1.5%, before April?

3) If no better rates would become available, then maybe it is better to keep this 2.2% Online ISA?



Basically I want to understand if I can continue using my old ISA, or do I need to create a new one.

Thanks

YorkshireBoy

phemark wrote: »

Basically I want to understand if I can continue using my old ISA

You can, but you're aware the introductory bonus rate expires on 31/7/14?


May as well start the Regular Saver ISA now being as it pays more?

phemark

YorkshireBoy wrote: »

You can, but you're aware the introductory bonus rate expires on 31/7/14?


May as well start the Regular Saver ISA now being as it pays more?

Hmm, for some reason I thought that once opened, this ISA will always keep my money tax free at 2.2%. So does this mean, that every year I need to keep looking for another ISA to my money? And once I have more savings than ISA limit, I will have to keep only a part of savings in ISA?

(My understanding of ISA was:
Put 5k in ISA
Next year put 5k in ISA, old ISA is kept
Next year put 5k in USA, two old ISAs are kept
and so on...

is this not how it works?....)

neil324

phemark wrote: »

Hmm, for some reason I thought that once opened, this ISA will always keep my money tax free at 2.2%. So does this mean, that every year I need to keep looking for another ISA to my money? And once I have more savings than ISA limit, I will have to keep only a part of savings in ISA?

(My understanding of ISA was:
Put 5k in ISA
Next year put 5k in ISA, old ISA is kept
Next year put 5k in USA, two old ISAs are kept
and so on...

is this not how it works?....)

Banks use teaser/bonus rates for a period of time, 1 year etc. Then after this the rate drops and you have to either suck it up or move the ISA.

phemark

neil324 wrote: »

Banks use teaser/bonus rates for a period of time, 1 year etc. Then after this the rate drops and you have to either suck it up or move the ISA.

I see.

So nobody is still on the ISA, which they opened 10 years ago?

KTF

phemark wrote: »

I see.

So nobody is still on the ISA, which they opened 10 years ago?

No because you roll them up and/or move to another provider with a better rate over the years.

rustyhead

Have I got this right


I've a bm fixed coming to an end on the 26th April, I can open a nationwide fixed for 2 yrs at 2.05 and transfer this in.
Open a regular saver isa for this years new money at 2.5
Ive also got a easy saver with them at 2.25% that bonus expires in Oct(last years isa) not sure what I will do with that just yet
thanks Rusty

phemark

KTF wrote: »

No because you roll them up and/or move to another provider with a better rate over the years.

So basically ISA is only good for one year, if you want highest returns?

Let's say I can save 5k a year starting now. Then I would put them in ISA 3 years (given 15k limit), and then once I have 20k to save, and only 15k can be put in ISA, rather than leaving money in old ISA, I would move 15k to new ISA, and then 5k to save somewhere else?
Is this how most of you save most efficiently?

neil324

phemark wrote: »

I see.

So nobody is still on the ISA, which they opened 10 years ago?

Someone, yeh sure. A poster was here the other day who's ISA for the last 6 years had been paying 0.1% after the bonus ended.

You either take that, or move it.

KTF

phemark wrote: »

So basically ISA is only good for one year, if you want highest returns?

Let's say I can save 5k a year starting now. Then I would put them in ISA 3 years (given 15k limit), and then once I have 20k to save, and only 15k can be put in ISA, rather than leaving money in old ISA, I would move 15k to new ISA, and then 5k to save somewhere else?
Is this how most of you save most efficiently?

As an example of moving an ISA every year and then topping it up with a theoretical 5k allowance.

ISA year 1 = 5k of 'new money' = 5k in an ISA.
ISA year 2 = 5k of transfer in + 5k of 'new money' = 10k in an ISA.
ISA year 3 = 10k of transfer in + 5k of 'new money' = 15k in an ISA.

And so on. If the account for years 2/3, etc is a high rate and allows transfers in then you can roll them up.

Sometimes the high rate accounts do not allow transfers in so you would open the high rate ISA for that year and put that years allowance in but also open another ISA that allows transfers in and move the existing ones to that (assuming it was better than the current rate they were earning).

If in year 3 you found that you had 6k 'spare' then yes, 5k could go in an ISA and the remaining 1k would be in a non-ISA account as you have more savings than your ISA allowance.