Finally Sensible ISA Advice

jimjames

Latest article in Daily Mail (yes I know) finally realises most people don't have tens of thousands stashed in their ISA and crushes the repeated ISA mantra that you should never withdraw cash from your ISA as it loses tax free status.

All they need to do now is to realise that an ISA doesn't give the best return.

Will MSE follow suit and update their advice?

http://www.dailymail.co.uk/money/saving/article-2693459/You-break-golden-rule-Isa-saving-beat-banks.html

Archi_Bald

They are still riding firmly on the (cash) ISA train. All they are talking about is a different ISA "transfer" method.

Nanpy

Yup, basically they're saying if you only have £5K spare to put into your ISA that financial year, then pull £10k out of your existing ISA account to supplement the £5k so as to maximise the rate you get because the best rates are being offered for "new" ISA accounts.

jimjames

Archi_Bald wrote: »

They are still riding firmly on the (cash) ISA train. All they are talking about is a different ISA "transfer" method.

That's true.

Hopefully it is starting people thinking though and ignoring the quoted advice to never withdraw money from an ISA.

For an average person with under £2k savings it is irrelevant saying they need to transfer as indeed using an ISA at all is irrelevant to their situation.

Nanpy wrote: »

Yup, basically they're saying if you only have £5K spare to put into your ISA that financial year, then pull £10k out of your existing ISA account to supplement the £5k so as to maximise the rate you get because the best rates are being offered for "new" ISA accounts.

That assumes you have £15k.

What they are really saying applies to people with well below the annual limit so the person who has the average ISA balance of £7k.

No point transferring when you can get a better rate as a new account by withdrawing as you won't use the whole allowance anyway.

For most people 5% current accounts are far better than any ISA.