Old ISA Matured

trenchwars

I have 18K that was in a 4% fixed-rate ISA that has just matured. Any thoughts as to where I can transfer it? Would rather not tie it into a fixed rate for too long.

xylophone

http://www.thisismoney.co.uk/money/saving/article-1583864/Best-savings-rates-Isas-Cash-Isa-accounts-fixed-rate-Isas.html

kidmugsy

We have grasped the nettle and withdrawn quite a bit from Cash ISAs to put into interest-bearing current accounts. 4%p.a. or 5%p.a. less 20% tax is better than 1.5%p.a. tax-free.

The new NISA rules from July mean that it's easier to return a large chunk of money to Cash NISAs when you want to.

trenchwars

Thanks, but its not a good option for me as I am a higher rate taxpayer.
I think I am going to go with the Santander 2 year fix at 2.3%. If rates go up in a year and I transfer out then even with the interest rate penalty it is not a bad rate for the market.

butterflymum

trenchwars wrote: »

Thanks, but its not a good option for me as I am a higher rate taxpayer.
I think I am going to go with the Santander 2 year fix at 2.3%. If rates go up in a year and I transfer out then even with the interest rate penalty it is not a bad rate for the market.

If you do decide on this, best consider making a move quickly. A number of recent threads have suggested the 123 Fixed Rate ISA @2.3% is due to change on Monday to a new issue at 2% or 2.1% (nb this is not yet confirmed).

kidmugsy

trenchwars wrote: »

Thanks, but its not a good option for me as I am a higher rate taxpayer.
I think I am going to go with the Santander 2 year fix at 2.3%.

Your shout, but 5% p.a. at TSB or Nationwide, less 40% tax, gives you 3% p.a.

innovate

kidmugsy wrote: »

Your shout, but 5% p.a. at TSB or Nationwide, less 40% tax, gives you 3% p.a.

Very true but what would you suggest the OP does with the other £14K?

I suggest they could find a 3% ISA for the lot if they looked about the board a bit.

kidmugsy

innovate wrote: »

Very true but what would you suggest the OP does with the other £14K?

If he's married £12k at TSB and £7.5k at Nationwide more than covers his case.

innovate

Don't get me wrong, I am a big fan of all those current accounts. But for a higher rate tax payer to pull £18K out of a tax shelter to get 3% interest (for a limited time on some of it) when they can get 3% or more in another cash ISA doesn't really make any sense, does it.

Also, gifting money to a partner, even one you are married to, might be too risky for many people. Just look at the various dramas people report with their current account accounts.

kidmugsy

innovate wrote: »

I am a big fan of all those current accounts. But for a higher rate tax payer to pull £18K out of a tax shelter to get 3% interest (for a limited time on some of it)....

Also, gifting money to a partner, even one you are married to, might be too risky for many people.

(1) But young Mr Osborne will let you bung £15k back in whenever you want.

(2) Some bloody marriage.

PeacefulWaters

kidmugsy wrote: »

(1) But young Mr Osborne will let you bung £15k back in [STRIKE]whenever you want.[/STRIKE] each tax year.

Fixed it for you.