ISA Transfer

Ads1

Hi guys,
I have tried to research the answer to this question but I am a little unsure. Hope you guys can help.

I currently have an ISA with Virgin which I pay in to every month, with quite a substantial sum in it. They have just sent me an email saying they are reducing the interest rate to 1.1% in September.

I was considering moving the lot in to one of their fixed rate ISA's. However, I was then advised that I would not be able to pay in each month anymore when that ISA gets removed from "sale".

I have also found a good ISA with Nationwide which allow monthly pay-ins, but they do not allow transfers.

Could I move my current ISA to a Virgin fixed ISA and then start paying regulary in to the Nationwide ISA?

I understand that you cannot pay-in to more than one ISA in the Tax year, but in theory I wouldn't be.

Can anyone help?
Many thanks
Ads

colsten

Without knowing the sums involved, without knowing what your tax rate is, and without knowing what your savings objectives are, only a theoretical answer is possible.

Ads1 wrote: »

Could I move my current ISA to a Virgin fixed ISA and then start paying regulary in to the Nationwide ISA?

you cannot pay new money into more than one cash ISA in the same financial year. As you have already paid into the Virgin ISA this year, you would need to transfer all your current year's deposits to a different provider

Ads1 wrote: »

I understand that you cannot pay-in to more than one ISA in the Tax year, but in theory I wouldn't be.

not sure what theory you are thinking of but in practice, you would be paying into more than one ISA

Nationwide do a 1.6% ISA that allows transfers in. But even at 1.6%, the question is why you want to pay your money into a cash ISA when you can get 6% AER in various regular savings accounts, or why you wouldn't use current accounts.

Ads1

Thanks for your reply.
I have £22k in the Virgin ISA currently and I'm on 40% Tax.
I had thought about the current account route, but I currently have separate pots for different things (Car costs, Household Bills etc), as I like to manage it that way.
Therefore I'm not sure one of those current accounts would be any good for me.

I am currently over paying my mortgage by the max amount, and pay around £150 a month in to my ISA.

What I ment by my in theory bit is I would stop paying in to the Virgin ISA and start paying in to another one. Therefore still only paying in to a single ISA in the tax year.

I cannot find any 6% regular savers, unless I am missing something.

Any options would be appreciated though.

colsten

Regular savings accounts: https://forums.moneysavingexpert.com/discussion/comment/6932895#Comment_6932895

Easiest for £150 a month @6% is at M&S

Current accounts selector: http://www.bankaccountsavings.co.uk/

Ads1 wrote: »

What I ment by my in theory bit is I would stop paying in to the Virgin ISA and start paying in to another one. Therefore still only paying in to a single ISA in the tax year.

See what you mean but this is not how it works. The ISA that you start paying into in a tax year is your ISA for the year. You can have it transferred as a whole (i.e. all the amounts you paid in) to another provider but you can't park it and start a new one elsewhere.

Anyway, it seems a waste of money to pay into a cash ISA at present rates. If you are savings for short / medium term (less than 5 years), current & regular savings accounts are better, even for 40% tax payers. If you are saving for longer term (5-10 years min), an S&S ISA and/or a pension could be more appropriate.A mixture of both approaches is sensible for most people, as you need both, an easily accessible cash reserve, and longer term provisions.

Ads1

Thanks, I actually have a company pension (defined benefit). So hanging on to that

I'll have another look at the other savings accounts. Thanks for that.