ISA's - What happens next...?

Fotoman_2

I've never had an ISA before and will shortly be arranging one, probably with National Savings.

Presumably, if I open an ISA with a £3,000 one-off payment, I'll only get the interest for the remainder of this year. (5th April 2008?)

So, next year, on 6th April 2008, can pay in another lump sum of £3,000 which will make the ISA worth £6,000 (plus the interest earned)?

If I take out an ISA with NS, can I also take another one out with someone else in the same year?

Thanks in anticipation.

Fotoman

Aegis

Fotoman wrote: »

I've never had an ISA before and will shortly be arranging one, probably with National Savings.

Presumably, if I open an ISA with a £3,000 one-off payment, I'll only get the interest for the remainder of this year. (5th April 2008?)

Correct

So, next year, on 6th April 2008, can pay in another lump sum of £3,000 which will make the ISA worth £6,000 (plus the interest earned)?

Would be correct under the current system. However, as of next year the cash account limit will be £3600, so you can put even more away than you can now.

If I take out an ISA with NS, can I also take another one out with someone else in the same year?

In short, no. You can transfer your funds from one ISA to another freely, but you can only subscribe to one cash ISA each tax year.

oldagetraveller

It will be interesting to see what they do next April, whether they'll continue with the guarantee or reduce the rate. "Guaranteed to stay 0.55% above the base rate until at least 5 April 2008" Wiil they reduce and rely on complacency or risk a possible mass exodus?
Might be worth delaying adding funds until they decide, then if the rate drops another isa can be opened with another provider (after 5th April) with a better rate then transfer NS&I to them?

Little_Miss_Penny_Less

Quote:
So, next year, on 6th April 2008, can pay in another lump sum of £3,000 which will make the ISA worth £6,000 (plus the interest earned)?
Would be correct under the current system. However, as of next year the cash account limit will be £3600, so you can put even more away than you can now.

Just to piggyback this thread... I have a Barclays ISA from last april that I have £2500 in... Can I put another £3k in and still get the same interest rate then? I thought I could only put up to £3k in the account. To make things clearer... where should I put the extra £3k I have saved up?

Liz_the_Whizz

Little_Miss_Penny_Less wrote: »

Quote:

Just to piggyback this thread... I have a Barclays ISA from last april that I have £2500 in... Can I put another £3k in and still get the same interest rate then? I thought I could only put up to £3k in the account. To make things clearer... where should I put the extra £3k I have saved up?

Your Cash ISA allowance is currently £3k each tax year.

So the answer to your question depends on which April you put the £2.5k into your Barclays Cash ISA.

If it was April 2007, you can add a further £500.

If it was April 2006, you can add a further £3000. But check the rate before you do as I don't think that Barclays ISA is one of Martin's best buys. You can open each year's ISA with a different bank/bulding society.

Then in April 2008, we'll all be adding £3600 to our ISA pot instead.

Once you're maxed out on your ISA, look at some of the instant access savings accounts such as Icesave which pays a very decent 6.2% gross at present. There are others, Martin's best buys will tell you all you need to know.

Milarky

Quote:
If I take out an ISA with NS, can I also take another one out with someone else in the same year?
In short, no. You can transfer your funds from one ISA to another freely, but you can only subscribe to one cash ISA each tax year.

Just to clarify that answer - if you transfer you can still subscribe up to any unused annual allowance in the same year. In other words, the allowance 'travels' with the ISA so that it is possible to have paid half the allowance in one account and half in another later - but only after the first account is effectively 'closed' upon transfer