Top Cash ISAs Discussion Area

Davioo

Hi, I have not yet filled my cash ISA for this year, and nor has my wife. We don't have the money available to fill them completely at the moment, but we wondering if it was worth using the credit card or going into our overdrafts to get the money to top them up.

Would it be worth paying the interest for the borrowing? Clearly the £3000/£6000 would be earning tax free interest for life so the money generated from that amount over a lifetime would be much more than the interest to be paid on the borrowing, right?

Hope i've made myself clear! If not, feel free to ask for clarity. Thanks.

Crabman

Davioo wrote: »

Hi, I have not yet filled my cash ISA for this year, and nor has my wife. We don't have the money available to fill them completely at the moment, but we wondering if it was worth using the credit card or going into our overdrafts to get the money to top them up.

Would it be worth paying the interest for the borrowing? Clearly the £3000/£6000 would be earning tax free interest for life so the money generated from that amount over a lifetime would be much more than the interest to be paid on the borrowing, right?

Hope i've made myself clear! If not, feel free to ask for clarity. Thanks.

Provided the interest rate on the overdraft/credit card is less than that on the ISA, it may work out. Even better if you have a 0% credit card and they're willing to make a transfer (Martin calls these "Super Balance Transfers) into your bank account, you'd then be able to make a greater profit.

It's a technique called Stoozing which I think may be what you're looking for - take a look at the article Stoozing: Make free cash from credit cards

Davioo

Crabman wrote: »

Provided the interest rate on the overdraft/credit card is less than that on the ISA, it may work out. Even better if you have a 0% credit card and they're willing to make a transfer (Martin calls these "Super Balance Transfers) into your bank account, you'd then be able to make a greater profit.

It's a technique called Stoozing which I think may be what you're looking for - take a look at the article Stoozing: Make free cash from credit cards

Thanks for that. i don't have a 0% card. Would this still be worth it even if the interest rate on overdraft/card were higher than the ISA?

Crabman

Davioo wrote: »

Thanks for that. i don't have a 0% card. Would this still be worth it even if the interest rate on overdraft/card were higher than the ISA?

If the overdraft/credit card rate being charged was greater than the interest rate being paid, you'd be losing out.

It's worth looking into stoozing but make sure you fully understand how it works - there is a dedicated sub-forum for any questions you may have.

Davioo

Crabman wrote: »

If the overdraft/credit card rate being charged was greater than the interest rate being paid, you'd be losing out.

But my point is that the ISA interest will be being acrued over my lifetime, and the overdraft/card would be paid off in the relatively near future. Wouldn't that mean that in the long run more money would be earned from the ISA than spent on the borrowing?

Thanks for your response.

crazyspaniels

trying to decide between the A&L or the Icesave Icelandic folks that Martin suggests, is the Icelandic bank still underwritten by the Bank of England if things go horribly wrong, or in the current climate would I be safer with A&L???

galacticgreen

Wonder if you could help. Neither my or my husband have an ISA, but we do have an offset mortgage that our savings are working towards. Should we take our ISA cash out of the savings account that helps our offset and put it in an ISA or is there no benefit to doing this. Think our mortgage interest rate is around 6.3%
Thanks for any advice you can give....

Wsb5tails

galacticgreen wrote: »

Wonder if you could help. Neither my or my husband have an ISA, but we do have an offset mortgage that our savings are working towards. Should we take our ISA cash out of the savings account that helps our offset and put it in an ISA or is there no benefit to doing this. Think our mortgage interest rate is around 6.3%
Thanks for any advice you can give....

it depends if you are both tax payers and at what rate and the rate you get on the ISA you pick. Use Martins calc to work out which is best for you
http://www.moneysavingexpert.com/mortgages/mortgages-vs-savings#calculator

phill79

English_Bob wrote: »

Hi Crabman, Fread T and all,

Try the A+L Premier ISA Issue 2. You can qualify for this 10% ISA if you are accepted for a NEW premier current account. (Existing current account holders have to pay into an 'Investment Product')
i have just applied, and A+L say they are allowing me to open an ISA this tax year and next WITHOUT taking out an investment product.
Only thing is you have to pay £500 in per month to their premier currnt account. i have set up standing orders to pay in and then immediately out of this current account. a bit of a hassle, but if you can afford to move this money about, it's the best interest you can get from an ISA.

SEE T+C's:

2.1 You may only open an Account at the same time as and if:
2.1.1 You apply and are accepted for a Current Account provided that You do not currently hold or have held in the last three
months preceding Your Current Account application any Alliance & Leicester current account;
2.1.2 You hold an existing Current Account or a Premier Direct Current Account and apply for either a Legal & General or Credit
Suisse Investment product in a branch and invest at least £5,000 in that Investment product for at least 30 consecutive
days;


so as long as you don't currently hold an account with them, you can get the 10%

Bob

It says on their page:

"Transfer in existing ISA funds from 6 April 2008 – all we ask is that 50% or more of your previous years’ transferred funds go into a Stocks & Shares..."

I assume this means that if you only have a cash ISA, this product is no good for a full transfer. Is this correct?

Crabman

Davioo wrote: »

But my point is that the ISA interest will be being acrued over my lifetime, and the overdraft/card would be paid off in the relatively near future. Wouldn't that mean that in the long run more money would be earned from the ISA than spent on the borrowing?

Thanks for your response.

It would depend on the individual rates and how quickly they were paid off. You'll only make a stoozing profit over the time you're borrowing the credit card/overdraft money.

Once you've paid the debt off, the ISA savings effectively become your money and that's where the profit ends. The stoozing calculator should be of help