Opening HTB ISA with already opened ISA from prior year 30 November 2015 at 12:11AM edited 30 November -1 at 1:00AM in ISAs & Tax-free Savings 3 replies 441 views

nick87_2

Hi, I'll try to summarise the facts so my question is easy to understand. I've had a look around on other threads but I cannot find the answer to my query.

1. I already have an ISA which I opened May 2014. However I have been paying in money since April 2015, a little under £1,500.

I understand I can still get a HTB ISA (I'm swaying towards Halifax's due to the higher interest rate), but I will have to do some juggling around with funds to do so because I have paid into but not opened an ISA this financial year.

What exactly will I have to do to be able to open the HTB ISA. I would assume there's more to it than to withdraw the £1,500 from the ISA I've already paid in to since April.

2. Also, what should I do with surplus funds which I cannot put into the HTB ISA? I am limited to saving £200 per month (other than the first month) so if I can 'put away' a couple of quid here and there in savings it'll be less difficult to spend than if left in my current account!

jimjames

For the sort of money you're talking about a normal cash ISA is pointless. You can get 5% on a current account which beats any non HTB cash ISA even after tax is taken into account.

So the remaining cash can go into the current account and get a far better rate than your cash ISA. The £1200 can start the HTB ISA.

nick87_2

jimjames wrote: »

For the sort of money you're talking about a normal cash ISA is pointless. You can get 5% on a current account which beats any non HTB cash ISA even after tax is taken into account.

So the remaining cash can go into the current account and get a far better rate than your cash ISA. The £1200 can start the HTB ISA.

Thanks - just so I understand, you're saying to my second point that I should get a current account and plonk surplus saving in there?

I can just let my other ISA (which I opened 2014) sit there and forget about it?

jimjames

nick87 wrote: »

Thanks - just so I understand, you're saying to my second point that I should get a current account and plonk surplus saving in there?

I can just let my other ISA (which I opened 2014) sit there and forget about it?

Yes, that's it. Until you've got over about £2k then look at another account but you can easily get many thousands at far better rates than a cash ISA.