The Newcastle Big Home Saver ISA

marathonic

Ed-1 wrote: »

Only problem I can see with this is the fact you can only pay in £500 a month making £6000 across the year when the allowance will be £15000...

That's true.

Personally, I can only save £1100 per month. It will be split as:

£500 Newcastle ISA at 3%
£300 First Direct Regular Saver at 6% (4.8% gross)
£300 Santander 123 Current Account at 3% (2.4% gross)


Next March, I think ISA rules allow you to transfer the entire Newcastle ISA to another provider and then top it up to the annual allowance - if desired.

Personally, I don't want more than £6,000 in a Cash ISA. Anything more will be going to an S&S ISA.

dbarcl10

Just to make folks aware, I phoned Newcastle today about the monthly limit on this ISA. It's currently £500 max per month but it's under review and may be increased in line with the new NISA limits. The agent I spoke with advised that even if the limit in this account isn't increased, you can take out another ISA with them god the remaining allowance

dbarcl10

Ed-1 wrote: »

Only problem I can see with this is the fact you can only pay in £500 a month making £6000 across the year when the allowance will be £15000...

I have just had it confirmed to me by Newcastle BS that the monthly limit has been increased to £1,250 in light of the new ISA allowances.

The website still says £500 per month, but assume that will be updated in the coming days.

marathonic

dbarcl10 wrote: »

I have just had it confirmed to me by Newcastle BS that the monthly limit has been increased to £1,250 in light of the new ISA allowances.

The website still says £500 per month, but assume that will be updated in the coming days.

Interesting development and makes this product significantly better than Nationwides - with a higher rate and no conversion to a product with a lower rate at the end of the tax year.

I look forward to the website update so that I can update my Standing Order

DesG

Just applied, thanks for the details everyone.

soulsaver

For debate:
For some people, I'm not sure this is quite the no brainer it immediately appears.

1) In effect you'll get the equivalent of c1.5% on £15k, not 3 % equiv't which, admittedly, is fine if you didn't have the cash lump at the outset.

But if your already getting 3% taxable (Santander, Lloyds, TSB, BoS..) its hardly worth the shuffling effort - although there is a more subtle argument for future tax planning.

2) At the end of 12 months, should you choose to invest your Isa elsewhere, what will happen to the bonus interest as you wont be able to make a qualifying contribution every month? Eh?

Unless they change something it'll be at least 1% less interest after 12 months...

The saving grace is you can make a near instant transfer if something better appears (that accepts transfers in) in the run up to the July changes...or at the next years Isa season.

Archi_Bald

soulsaver wrote: »

1) In effect you'll get the equivalent of c1.5% on £15k, not 3 % equiv't which, admittedly, is fine if you didn't have the cash lump at the outset.

But if your already getting 3% taxable (Santander, Lloyds, TSB, BoS..) its hardly worth the shuffling effort - although there is a more subtle argument for future tax planning.

It should be obvious that having money saved in a 3% tax free account would yield more money after a year than a 3% taxable account. But here are some numbers:

You would make £242.65 if you put £1,250 each month into the ISA.
If you were dripfeeding it from a 3% taxable account, you would make £409 in total as a basic rate tax payer.
If you left the £15,000 in your taxable 3% account, you would make £360 as a basic rate tax payer.

Arrived with the help of the MSE Reg Savings calc which isn't quite up to the job for this because it doesn't allow a mixture of taxable or non taxable savings. You can create a spreadsheet if you want to verify my numbers.

soulsaver wrote: »

2) At the end of 12 months, should you choose to invest your Isa elsewhere, what will happen to the bonus interest as you wont be able to make a qualifying contribution every month? Eh?

You would try to transfer your ISA to a better place. If you don't, and if you choose to put your new contributions elsewhere, then of course you will not get a bonus any longer from Newcastle.

soulsaver

Obviously. That's why it says 'hardly worth it...' as opposed to 'not worth it..'

Archi_Bald

I make about £1.2K a year from all those "hardly worth it" bits that are available in the market. I hate that Tesco slogan, but they are right, every little helps

Archi_Bald

marathonic wrote: »

I look forward to the website update so that I can update my Standing Order

I don't have the ISA incarnation of this account but the normal one....this also takes up to £1,250 now and they have let me deposit another £750 today. So no need to wait for the website update.