Lloyds Isa

Wood9272

Hi all . Just after a bit of friendly help
I have 8k in a lloyds Isa which is paying a terrible rate of 0.55 gross , I'm going to paying In 250 pound extra a month for the foreseeable ,my question is when do Lloyd pay the interest on this as once they do I want to know what is a good ISa to transfer to
all help appreciated

Archi_Bald

If you have £8K now and add £250 a month, it will take you more than 2 years before you get near the annual ISA allowance. You would make much more interest if you put your entire ISA into one or two current accounts (TSB, Tesco etc), and saved your £250 a month in a 6% regular saver (e.g. M&S).

As and when you get to £15Kish, you can still put the money into an ISA, if indeed ISAs offer any better interest rates then.

ChesterDog

Just with the small caveat that this assumes subsequent governments don't chop lumps off the annual ISA allowance.

Wood9272

Thanks to you both for your replies . Do you know when the lloyds interests payment are made , once that is done I will look for a good current account

PeacefulWaters

Wood9272 wrote: »

Thanks to you both for your replies . Do you know when the lloyds interests payment are made , once that is done I will look for a good current account

They pay interest on the day you close it.

No point waiting with a low rate. Either organise an ISA transfer or close it and transfer it to that high paying current account.

xylophone

Do you know when the lloyds interests payment are made , once that is done I will look for a good current account

Does it really matter? The interest to date will be added when the account is closed/transferred.

If you have £8K now and add £250 a month, it will take you more than 2 years before you get near the annual ISA allowance. You would make much more interest if you put your entire ISA into one or two current accounts (TSB, Tesco etc), and saved your £250 a month in a 6% regular saver (e.g. M&S).

To access the regular saver, you need to open a current account with M&S but it does not pay interest.

You could open a TSB Classic Plus with £2000 and earn interest of 5% (gross) - remember to set for paperless statements and correspondence and to cycle in and out the required monthly credit.

You could open a couple of (3% gross) BOS Vantage accounts with £4500 in one and £1500 in the other and set up monthly standing orders between them to satisfy the monthly credit - you could transfer the interest from the TSB into the account holding the £1500.

Archi_Bald

xylophone wrote: »

To access the regular saver, you need to open a current account with M&S but it does not pay interest.

that's not an issue as you do not need to keep any money in the current account. Just send £250 in once a month for the RS

xylophone wrote: »

You could open a couple of (3% gross) BOS Vantage accounts with £4500 in one and £1500 in the other

That is not a good suggestion as the minimum for the 3% is a £3K balance. But 2 x £3K would work

xylophone

Thanks re BOS - I use mine to the maximum and had not noticed that between £1000 and £3000 the interest is only 1.98% gross.

Your suggestion of £3000 in each Vantage is the wiser option!

If you have £8K now and add £250 a month, it will take you more than 2 years before you get near the annual ISA allowance. You would make much more interest if you put your entire ISA into one or two current accounts (TSB, Tesco etc)

I was thinking that if he used TSB and 2 Tesco, he'd have nowhere to earn interest on the interest arising

that's not an issue as you do not need to keep any money in the current account. Just send £250 in once a month for the RS

I was just commenting ( in case the OP did not know) that the RS could not be accessed without a CA.

bowlhead99

Wood9272 wrote: »

Thanks to you both for your replies . Do you know when the lloyds interests payment are made , once that is done I will look for a good current account

You don't need to look too far from home as Lloyds Club pays 4% if you keep between £4-5k in there and allows up to £400pm payments into their club regular saver, also at 4%. Initially your £8k is a bit too high to fit but with a combination of other current accounts you'll be a lot better off than your 0.5% net

xylophone

You don't need to look too far from home as Lloyds Club pays 4% if you keep between £4-5k in there and allows up to £400pm payments into their club regular saver, also at 4%.

But don't forget that you also need two monthly direct debits on the Lloyds Club as well as the minimum payment in of £1500 (can be cycled in and out) to get the 4%.

No DDs? These can be set up on an internet saver and an instant access saver with Tesco.