Top Cash ISAs Discussion Area

purplestar133

marathonic wrote: »

It looks like most people intending to save into a Cash ISA in 2013 would be best opening one of the new Nationwide Accounts with a 5% rate (taxable) for balances of up to £2,500 for the first year. For a lower rate tax payer, this is the same as a 4% ISA.

Then, when the 2013/4 tax year is nearly over, withdraw the money and pop it in an ISA to get it into the sheltered wrapper for future years.

leaphaze wrote: »

Just to add some detail here: this is the FlexDirect bank account which pays 5.00% AER (4.89% gross p.a.) on in-credit balances up to £2,500 fixed for 12 months if you pay in at least £1,000 per month (there is no monthly fee).

What I'm not sure is whether you can have both a FlexAccount and FlexDirect bank account at the same time.

Damn! Got my hopes up there but haven't got £1000 a month to put in, only £250 or so each month. I would have if I switched my current account completely, but I don't want to, I would want to open this just for drip feeding savings into.

innovate

purplestar133 wrote: »

Damn! Got my hopes up there but haven't got £1000 a month to put in, only £250 or so each month. I would have if I switched my current account completely, but I don't want to, I would want to open this just for drip feeding savings into.

You do not have to switch your current account to benefits from the Flexdirect 5% AER.

If you can save £250 a month, you can deposit £1K into a FlexDirect. 4 x £250 is as good as 1 x £1,000.

Save 10 x £250 into a FlexDirect, get 5% AER on it (4% after basic rate tax.) When you have £2,500 in the FlexDirect, you can take the lot and put it into an ISA. Over the next 12 months, no ISA will pay you as much interest as the FlexDirect. You won't lose out on your 2013-14 ISA allowance if you deposit something into it on or just before April 5 2014.

purplestar133

innovate wrote: »

You do not have to switch your current account to benefits from the Flexdirect 5% AER.

If you can save £250 a month, you can deposit £1K into a FlexDirect. 4 x £250 is as good as 1 x £1,000.

Save 10 x £250 into a FlexDirect, get 5% AER on it (4% after basic rate tax.) When you have £2,500 in the FlexDirect, you can take the lot and put it into an ISA. Over the next 12 months, no ISA will pay you as much interest as the FlexDirect. You won't lose out on your 2013-14 ISA allowance if you deposit something into it on or just before April 5 2014.

I thought you had to deposit a min of £1000 a month? Do you mean put £250 in and take it out, then again 3 times to make up the £1000 a month?

innovate

purplestar133 wrote: »

I thought you had to deposit a min of £1000 a month? Do you mean put £250 in and take it out, then again 3 times to make up the £1000 a month?

yes :cool:

dragilex

innovate wrote: »

yes :cool:

innovate wrote: »

You do not have to switch your current account to benefits from the Flexdirect 5% AER.

If you can save £250 a month, you can deposit £1K into a FlexDirect. 4 x £250 is as good as 1 x £1,000.

Save 10 x £250 into a FlexDirect, get 5% AER on it (4% after basic rate tax.) When you have £2,500 in the FlexDirect, you can take the lot and put it into an ISA. Over the next 12 months, no ISA will pay you as much interest as the FlexDirect. You won't lose out on your 2013-14 ISA allowance if you deposit something into it on or just before April 5 2014.

Wow. I'm glad I read this. So if I put in say £1200 into this account and then each month, take £1000 out and then put it straight back in, I'll be able to earn 4% interest on it? And I don't need to hold any other account to qualify?

MoneySaverLog

dragilex wrote: »

Wow. I'm glad I read this. So if I put in say £1200 into this account and then each month, take £1000 out and then put it straight back in, I'll be able to earn 4% interest on it? And I don't need to hold any other account to qualify?

Just make sure you're funding the £1,000 requirement from outside of Nationwide as per their small print

"FlexDirect offers 5.00% AER (4.89% gross p.a.) credit interest (fixed for first 12 months, reverts to 1.00% gross p.a./AER variable afterwards) on in-credit balances under £2,500 if you pay £1,000 or more into your account each month (excluding internal transfers). Rates may be withdrawn without notice. The gross rate of interest is the interest rate payable before any income tax is deducted (if you do pay tax). AER stands for 'annual equivalent rate' and illustrates what the interest rate would be if interest were paid and compounded each year."

innovate

dragilex wrote: »

Wow. I'm glad I read this. So if I put in say £1200 into this account and then each month, take £1000 out and then put it straight back in, I'll be able to earn 4% interest on it? And I don't need to hold any other account to qualify?

That's right.

All the details here:

http://www.nationwide.co.uk/current_account/flexdirect/default.htm

jonmase

In case anyone's interested, I was in my local Santander branch yesterday and was told that they will be releasing a new 1 year fixed ISA for 123 current account customers next monday (11th March). They didn't/couldn't tell me the exact rate, but implied that it would beat everything that's out there at the moment (not that it takes much to do so)!

Pursey

I'm new to this, so please go easy on me. I have recently inherited some money and would like to put it in an ISA before April, I am happy to invest it over a longer period, so am not sure whether a cash ISA would be appropriate, or what the other options are, can anyone help?

leaphaze

Pursey wrote: »

I'm new to this, so please go easy on me. I have recently inherited some money and would like to put it in an ISA before April, I am happy to invest it over a longer period, so am not sure whether a cash ISA would be appropriate, or what the other options are, can anyone help?

You need to give us some more info if you want helpful answers:

• How much is involved;
• What is your definition of a longer period;
• (if you're considering a Stock & Shares ISA as opposed to a Cash ISA) what is your attitude towards risk.