Top Cash ISAs Discussion Area

freeasabird

10_66 wrote: »

The problem with ISA's is that if you open a variable rate ISA (where the terms and conditions are usually instant access and to which you can usually add more money, but not always), the rate tends to drop after the first 12 months (because the ISA provider hopes that you'll be either too lazy to move it or just forget to), so we all have to do the ISA dance and transfer our ISA's to another provider, and so the whole process starts again for another 12 months'. So if you opened a variable rate ISA now, and wanted to add to it for 4 years', you would probably need to keep moving it every year to ensure you're getting the best interest rate you can.

If you open a fixed rate ISA for say 2, 3 or maybe 4 years', then this removes the ISA dance for that period of time, but, you say you want to be able to add £100 on a monthly basis, and usually you can't add to a fixed rate ISA once the initial funding had been paid/transferred in. You might find Regular Saver ISA's but Kazza doesn't have any listed on her "best buy" list, which might mean there aren't any worth having. Have a look at Kazza's LINK HERE, it will gives you a list of the best ISAs out there.

Correct me if I'm being silly but if you have a fixed rate ISA; can you add money each year up to the ISA limit and carry on doing that for the next 2,3 or 4 years?

Lokolo

freeasabird wrote: »

Correct me if I'm being silly but if you have a fixed rate ISA; can you add money each year up to the ISA limit and carry on doing that for the next 2,3 or 4 years?

99% no. Fixed term deposits usually only allow 1 deposit, or are opened for a specific short period before they are closed to more deposits.

freeasabird

Lokolo wrote: »

99% no. Fixed term deposits usually only allow 1 deposit, or are opened for a specific short period before they are closed to more deposits.

Thank you.

kchowns

My wife added £2500 for this tax year to a fixed rate money ISA, but had a recent contribution £1800 returned from Northern Rock saying that the fixed rate issue had closed. When she spoke to a NR adviser she was told no new monies could be paid to another ISA either with NR or another provider! :mad: Surely the withdrawal of a special issue cannot prevent a person still being able to invest the full £5340 in the current tax year? Any ideas? Logically i would have thought you could open another ISA with NR.:(

blueberrypie

As stated by Lokolo two posts above yours, most fixed-rate ISAs allow only one deposit, when the ISA is opened.

If your wife wants to save another £1800 in an ISA before the end of the current tax year, her only option is to transfer the funds which are currently in her ISA to another ISA which will allow top-ups. There will probably be a penalty of some sort - likely loss of some or all of the interest - for closing the fixed-rate ISA early.

dougal76

I do apologise if the answers to the following questions are in the thread, but I wasn't wanting to read through 90+ pages to find the answers, sorry.

I have a couple of questions regarding changing ISAs and shifting money to new ISA etc and I am hoping someone on here will be able to help.

I have some money in a stocks and shares ISA, which has now closed but is still able to increase/decrease depending on the market, though I don't continue to pay money into it. I want to know if I move this to a new Cash ISA, can I only transfer the current yearly tax free allowance ie £5500 approx or can I transfer the full amount which is more than the yearly tax free allowance??

Also if I want to move my existing cash ISA to a new provider, should I do it now or wait until the new tax year? Also can I transfer the whole amount (again more than the yearly tax free allowance) or do I have to transfer just up to the tax free allowance? If I can transfer the whole amount can I also add the approx £5500 of this years allowance at the same time??

I know it's kind of convoluted but I hope it makes sense. Any useful info would be greatly appreciated.

blueberrypie

dougal76 wrote: »

I have some money in a stocks and shares ISA, which has now closed but is still able to increase/decrease depending on the market, though I don't continue to pay money into it. I want to know if I move this to a new Cash ISA, can I only transfer the current yearly tax free allowance ie £5500 approx or can I transfer the full amount which is more than the yearly tax free allowance??

You can't transfer money from a s&s ISA to a cash ISA - you would have to withdraw it and use it as "new" money funding a cash ISA - so you would be using your cash ISA allowance for the current year, and you would be limited to the maximum allowance.

dougal76 wrote: »

Also if I want to move my existing cash ISA to a new provider, should I do it now or wait until the new tax year? Also can I transfer the whole amount (again more than the yearly tax free allowance) or do I have to transfer just up to the tax free allowance? If I can transfer the whole amount can I also add the approx £5500 of this years allowance at the same time??

As long as you use the proper transfer procedure (i.e. submit a form to the new ISA provider) you can transfer the full amount. You must keep the current year's subscriptions (i.e. new money paid in during the current tax year) together, but you can split previous year's subscriptions in whatever way you wish. And yes, as long as the new ISA provider accepts further subscriptions, you can transfer the full amount and then add this year's allowance - or you can add it to the old ISA and then do the transfer if that's easier.

As long as you're out of any contracted period (e.g. on a fixed-rate ISA), it doesn't matter if you move it now or after April 5th - although if the interest rate on your current ISA has dropped, you might as well do it sooner and start earning more interest.

dougal76

Cheers for the answer, this helps alot. I take it that if I could take out £10500 approx and use that to put into my own cash ISA and open a cash ISA for the wife that would be ok? I could then take out the remaining money and put it into the ISA's for next years allowance, that would be ok??

daisy1

I'm feeling a bit thick as I have a couple of ISA's from years back that I have just left as never been sure what to do with them, so not sure what sort of interest rate they are now accumulating.
But the question I really want to ask is if I invest £5340 now how does it work on April 5th, do I just get the interest between now and then, in which case is it better to wait until the new tax year. Or would it be beneficial to invest the £5340 now and another £5340 on April 6th.
Apologies if you've heard all this before but just want clarification and can't fact going into banks etc. to ask.

gallygirl

If you invest the £5340 now you will get around 2 month's interest this tax year, then a full year's interest next year if you leave it in. You can then add another £5340 come April 6th. Look for the one with the highest rate.

Please track down your other ISA's - you will be getting a very low interest rate! In addition to the above account, you can also open one just to transfer over all your others.

Generally speaking the best rates are for new money, not transfers in, but if you find it hard to motivate yourself/keep track etc then just open the one account which offers the highest rates for transfers in, and transfer your other accounts over as well as funding with the £5340.