ISA or Poppy Saver

50Twuncle

My wife is a non-income tax payer !!

Can she convert all of her, already built up ISA allowance to save in a "normal" savings account, such as Coventry poppy saver (which she still has and presumably can still credit) - paying 1.75%
Compared to 1.5% fixed cash ISA rates - when you have no access to your funds and are unable to transfer them out, should rates increase
Or will she lose her rights to her built up ISA if she does this ?
We don't want to tie the money away for more than 12 months - interest rates MUST rise someday ?

eskbanker

Taking funds out of ISAs (other than transferring between ISAs) is an irreversible one-way situation so yes, she would "lose her rights to her built up ISA" if you mean preserving its tax-free status. That's not necessarily a disaster for a non taxpayer though, you'd need to weigh up the relative rates and consider how long the plan would be to save for, also bearing in mind that replenishing cash ISAs will be easier after July when the new allowance kicks in....

50Twuncle

eskbanker wrote: »

Taking funds out of ISAs (other than transferring between ISAs) is an irreversible one-way situation so yes, she would "lose her rights to her built up ISA" if you mean preserving its tax-free status. That's not necessarily a disaster for a non taxpayer though, you'd need to weigh up the relative rates and consider how long the plan would be to save for, also bearing in mind that replenishing cash ISAs will be easier after July when the new allowance kicks in....

That's what I thought and with negligible interest rates - the difference is not worth worrying about - it will only take her 4 years to regain her allowance !!

eskbanker

Just in case you're not already aware of it, the other thing worth mentioning is that there are interest-paying current accounts available where you can get 3-5% on capped sums rather than 1-5-1.75% in traditional savings accounts - there are a few hoops to jump through but many on here find these easily manageable, see here and numerous threads on the banking and savings boards for further details....

50Twuncle

eskbanker wrote: »

Just in case you're not already aware of it, the other thing worth mentioning is that there are interest-paying current accounts available where you can get 3-5% on capped sums rather than 1-5-1.75% in traditional savings accounts - there are a few hoops to jump through but many on here find these easily manageable, see here and numerous threads on the banking and savings boards for further details....

Thanks - we need access though - at least not tied in for more than 12 months !!
Plus access to regular payments INTO the account - would prefer not to have to "filter feed" account from current account either
A simple - "put money in/withdraw if required" is what we need !!
Most (if not all) of the accounts suggested fail to allow the full sum of money to be invested in one account either - £2500 is nowhere near enough - even Santander limits an account to £20,000 !!
1.5% appears to be the going rate for £50k - that's appalling

innovate

You can get at least £29K into accounts that pay 3, 4 or 5% AER, with instant access. Yes, you need to jump through a few hoops but it is all very easy, and certainly worthwhile.

If you scour the ISA forum, you will also find some ideas for cash ISAs that pay better than 1.75% and allow transfers in. One is 3% but has 90 days notice, I think.

In short, there are lots of options available to you / your wife that are significantly better than 1.75%

50Twuncle

innovate wrote: »

You can get at least £29K into accounts that pay 3, 4 or 5% AER, with instant access. Yes, you need to jump through a few hoops but it is all very easy, and certainly worthwhile.

If you scour the ISA forum, you will also find some ideas for cash ISAs that pay better than 1.75% and allow transfers in. One is 3% but has 90 days notice, I think.

In short, there are lots of options available to you / your wife that are significantly better than 1.75%

Thanks - I will have a look