MSE News: Torn between easy-access and fixed cash ISAs? More providers now let you... 5 March 2015 at 1:14PM in ISAs & tax-free savings 22 replies 3.8K views

Former_MSE_Helen

MoneySavingExpert.com explains how you can split your cash between easy-access and fixed cash ISAs...

Read the full story:

Torn between easy-access and fixed cash ISAs? More providers now let you open both




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Archi_Bald

MSE wrote:

This isn't the best way to earn the most interest on your money – see our Top Cash ISAs guide for the best buys – but if you need easy-access and want to earn the most for your cash, by using this loophole you can open two ISAs in the same tax year, all for new money, as long as it's with the same provider.

The best way to earn most interest on money you need instant access to remains to be, for most people, interest earning current accounts.

jimjames

Such a shame that the article starts with the following

" cash savers have an increasingly bigger decision to make:"

And perpetuates the "use it or lose it" mantra but then fails to mention at the start that the biggest decision is whether to use an ISA or not.

For the 70% of people with under £2000 in savings it would seem to be far more beneficial to use a TSB account at 5% than an ISA at 1%.

bowlhead99

jimjames wrote: »

Such a shame...

To be honest, I'm not quite sure I get the contempt with which forum members pour scorn on any ISA article which does not first use up several column inches talking about how you can earn interest from taking a tour of the top current accounts.

This seems to me to be a factual article about features being made available by at least 6 providers to allow customers to allocate their single-provider current year ISA limit between longer term lockup and shorter term access objectives.

That is an interesting development because in the past it has not been heavily publicised by the providers or the financial press and it is only through reading discussion between people on the forum that you hear how (e.g.) Nationwide lets you split the pot and call it one ISA.

So, greater flexibility within financial products that have been in line for criticism of late (due to them being temporarily outpaid in the low interest rate environment by current account loss-leaders) would seem to be worthy of note.

For the 70% of people with under £2000 in savings it would seem to be far more beneficial to use a TSB account at 5% than an ISA at 1%.

Probably fearful of your derision for daring to have an ISA article which is talking about ISAs without also talking about how you might like to alternatively deploy your capital, the article is careful to note:

If I can get 5% in a current account, is it worth putting money in an ISA?

• While cash ISAs easily beat top normal savings, some bank accounts offer up to 5% savings as loss-leaders – see our Best Bank Accounts guide for the top deals. So even after tax, they beat the top cash ISAs.
• But it's not as straightforward as this as you also need to take into consideration the tax-free status of ISAs. You need to weigh up what's more important to you – higher interest rates now, or building up cash that stays tax-free year after year. Martin's Santander 123 v cash ISA analysis explains all.

Just because the article doesn't go back to basics and give us a heavy handed reminder about all the types of financial product available before it shares with us the news about the ISA market changes, you don't need to get all riled up.

"Hey, if you want instant access, first go and read all our current account articles! Do that before you read the news associated with the headline you clicked!"; "Hey, if you don't mind locking up your cash, have you heard of the pensioner bonds! Do that before we give you the news"; "Hey, if you are willing to do without your money for a while, have you heard of S&S investments!"

As any regular user of a M.S.E. website will be aware of all these products it is not completely imbecilic to actually deliver the news on the ISA changes first, talk about them and then drop in the comments about competing products at the end, which they did.

colsten

MSE's very own 'savings fountain' agrees with those "scornful" forumites who you criticise for stating facts.

http://www.moneysavingexpert.com/savings/which-saving-account

enthusiasticsaver

Interesting development and I guess the product could be useful to higher rate taxpayers who just want to stick money away in a cash isa so they do not need to declare the interest on a tax return. I am sticking to s and s isas now but my husband as a higher rate tax payer and one who likes a simple life is considering one.

bowlhead99

colsten wrote: »

MSE's very own 'savings fountain' agrees with those "scornful" forumites who you criticise for stating facts.

http://www.moneysavingexpert.com/savings/which-saving-account

I am not denying that as per the savings fountain article, " in-credit rates currently smash easy access savings accounts and ISAs. It's a loss leader to build banking customers - yet if you're prepared to switch account, rates are strong. Don't just focus on rate, aim to cover as much as possible at decent rates.". This is patently true.

What is tiresome is the fact that if MSE ever publish an article about ISAs or term deposits or whatever, you always get people diving into the comments section absolutely flabbergasted and indignant that MSE has no business to be telling people that ISAs exist when the average saver has less than £2000 and should be putting it into a current account pronto.

My point was that we know all this, the MSE articles do reference it (just not as the opening line every time) and the article you linked is an example of MSE being fully aware of how you could best allocate your cash to maximise rates. My assumption is that if you get a writer to do a piece on a particular subject they should not be forced to trot out a 'best of' all the other articles that exist on the site or the forum before they are allowed to share with you the main thrust of the article. It is a self help website without intending to provide everyone perfect financial advice starting from scratch in every article.

I probably sound like I am making a fuss over nothing and being a keyboard warrior which ironically is what I posted on here to criticise others for. It was just that I could tell before I clicked on the comment thread pretty much who was going to be jumping on the bandwagon to criticise MSE and what point they were going to make as usual.

Anyway I'll duck out now

Archi_Bald

bowlhead99 wrote: »

What is tiresome is the fact that if MSE ever publish an article about ISAs or term deposits or whatever, you always get people diving into the comments section

and as of recently also followed instantly by you diving in with your criticism or the criticism.

bowlhead99 wrote: »

My point was that we know all this, the MSE articles do reference it (just not as the opening line every time) and the article you linked is an example of MSE being fully aware of how you could best allocate your cash to maximise rates.

So it would be easy to refer to the linked article right at the start of each article about ISAs.

bowlhead99 wrote: »

I probably sound like I am making a fuss over nothing and being a keyboard warrior which ironically is what I posted on here to criticise others for.

quite.

bowlhead99 wrote: »

Anyway I'll duck out now

see you soon

jimjames

bowlhead99 wrote: »

I probably sound like I am making a fuss over nothing and being a keyboard warrior which ironically is what I posted on here to criticise others for. It was just that I could tell before I clicked on the comment thread pretty much who was going to be jumping on the bandwagon to criticise MSE and what point they were going to make as usual.

Apologies - I'm getting far too predictable, I'll have to stop being like a worn record

Gordon_the_Moron

A word of warning for anyone thinking of doing this.

Split your 2015/2016 £15000 allowance on April 6th between a 2 year fix and variable rate account with one bank/building society.

If they cut the variable rate a month down the line, you're stuck!
You can't transfer elsewhere without transferring the fixed rate account too (probably wiping out the gain of transferring with an exit penalty) and you can't up the rate any other way.

Consumerist

jimjames wrote: »

Apologies - I'm getting far too predictable, I'll have to stop being like a worn record

Apology accepted.

But don't beat yourself up too much. Sadly, there are others, of like mind, who will jump in to do it in your stead but, unlike yourself, they don't seem to realise they too are sounding like a worn record.