Transferring ISA. Now or in April?

wyrleyite

I currently have money sitting in an ISA and already used this years allowance by the end of April and was considering transferring it to another provider which pays higher interest.

My question is am I better off leaving it until the start of the next tax year and getting this years full interest payments from my current provider. Or should I change now, and if I do what happens to any interest I have accrued so far?

Ian_W

wyrleyite wrote: »

My question is am I better off leaving it until the start of the next tax year and getting this years full interest payments from my current provider. Or should I change now, and if I do what happens to any interest I have accrued so far?

It really depends on what your current rate is compared with what you can get from a new provider. There is an up to date list posted by Kazza at
http://forums.moneysavingexpert.com/showthread.html?t=401374
which should give you some idea of what a new provider could offer.
Interest is usually worked out daily but only credited to the account once a year, however, if you transfer it will be added [up to the date you leave] to the sum sent to the new ISA provider so you won't lose interest in that respect.
There is another "however", however and that is you may lose interest for the time it's in transit which over a weekend could amount to 3/5 days. Some, like YBS credit your account from the day after the cheque they receive is dated, others like Kent Reliance IIRC credit it 2 days after they actually receive the cheque. So if the difference is <0.5% you may not gain very much by moving now, if it's more than that you probably will.

nrsql

Whenever you do it you will lose a few days interest due to the transit.

The interest to date for the year will be paid and transferred with the isa so that won't be affected by the timing either.

So if you are going to transfer to a higher rate you should do it now rather than wait and lose the interest difference.
Make sure both providers have included the rate rise when you compare.

Gordon_the_Moron

Kent Reliance building society currently offer the best rate for an account that allows transfers in (postal account) Yorkshire BS offer the best online product.

Da Moron

Milarky

nrsql wrote: »

Whenever you do it you will lose a few days interest due to the transit.

This is sometimes covered by a guarantee from the new ISA provider to backdate interest (but not in all cases - agreed)

I've now switched just over half my instant-access Halifax ISA to a one year fix (at 6.2% not the best, but a big improvement on the previous rate) This has the advantage to me of raising my combined rate to 6% (from 5.55% this month) with no lost days as it is an internal switch - and therefore instant. I can now wait a while for rates to go even higher (eg October or November) before considering the more costly option of a transfer out of Halifax of the instant access part. unfortunately the best rate providers don't seem to be the ones giving guarantees on transfer dates.