Top Cash ISAs Discussion Area

owitemisermusa

KTF wrote: »

The First Direct one requires you to open one of their current accounts as well. Then if you dont fund it with £1500 a month, they charge you a fee as well.

Its a lot of hassle for an extra 0.1% imo.

Oh, forgot about that. But, if you have a FD current account in addition to another FD product, you won't need to fund it with £1500 monthly though.

bazza2000_2

Can I ask what is hopefully a non-stupid question around ISA's and Regular saving ISA's.
I currently have an ISA (£3600 contributed in this tax year) with A&L which I'm looking to move after the 6th April to Natwest e-ISA. My question is, is it better for me to top this one up with £3600 i.e. total of £7200 @ approx 3.51% with Natwest, or better for me to leave the £3600 in the Natwest ISA and start a Regular savings ISA with First Direct and pay in £300 a month to get 7%, then after next year, transfer them both into the best paying ISA at the time?
Not too sure if I can have 2 ISA's with different providers either?

Thanks,

Calchas

This thread may go some way to answering the first part of your post:

http://forums.moneysavingexpert.com/showthread.html?p=19864703#post19864703

As for your query with regard to multiple suppliers, you can have a different asylum, sorry, institution each year if you wish to.

Baldur

bazza2000 wrote: »

I currently have an ISA (£3600 contributed in this tax year) with A&L which I'm looking to move after the 6th April to Natwest e-ISA. My question is, is it better for me to top this one up with £3600 i.e. total of £7200 @ approx 3.51% with Natwest, or better for me to leave the £3600 in the Natwest ISA and start a Regular savings ISA with First Direct and pay in £300 a month to get 7%, then after next year, transfer them both into the best paying ISA at the time?

You can do any of the above. Which is better, depends on your personal circumstances, e.g. are you likely to need access to your funds (which would be a problem with the First Direct Regular Saver).

£7,200 at 3.51% (assuming that that rate doesn't vary over the full 12 months) would give you around £7,452 (plus interest on the interest that would be transferred with your old A&L ISA).

The transferred A&L ISA of £3,600 at 3.51% (same assumptions as above) would give you £3726.26 (plus interest on the interest that would be transferred), while the FD Regular Saver - £300 per month at 7% would give you around £3,734.75 plus any interest earned in a normal savings account on the funds which are awaiting the monthly payment into the Regular Saver.

Not too sure if I can have 2 ISA's with different providers either?

You can have as many Cash ISAs with different providers as there have been tax years since ISAs were introduced in 1999.

leaphaze

I know this is a Cash ISA thread but since we've had a couple of people posting about Cash ISA's aimed at regular savers, I thought I'd mention tax-free regular savers for children. Halifax have been doing these for sometime and I'm really disappointed no other institution have. We've been running 2 of these for 3 years or so; started at 10% now dropped to 8%.

You pay in a fixed amount (£100 max per a/c) per month. After 12 months the balance and interest is transfered into another a/c within Halifax. If you carry on paying, the account continues. The regular saver is a joint a/c between 1 adult and 1 child, so if you're a 2-parent 2-child family you could have up to 4 of these, paying in up to £400 per month. In fact, when I opened our a/cs a few years ago, there needn't be any legal relationship between the child and adult, so granny, auntie or godparent could open an account for a child. The transfered-to a/c is in the name of the adult so the money can be moved anywhere from there.

Well worth considering, I would have thought.

Jo-or

Can anybody explain in simple terms the advantages, if any, of a shares ISA over a cash ISA. I know I can invest £7200 in the former type. But what risk is there to my capital in a shares ISA?
Thank you

leaphaze

Jo-or wrote: »

Can anybody explain in simple terms the advantages, if any, of a shares ISA over a cash ISA. I know I can invest £7200 in the former type. But what risk is there to my capital in a shares ISA?
Thank you

With a Cash ISA there is no risk to your capital, other than the institution going bust. The maximum you can invest per year is £3600.

With a Stocks & Shares ISA the risk to your capital is that the value of the Shares or Funds in the ISA, go down more than any yield. The maximum you can invest per year is £3600, or £7200 if you don't have a Cash ISA.

Currently, the later is much more likely to happen than the former. However, over the long term, if you can keep your nerve, the later will yield more than the former. I guess it depends on what you have planned and your schedule.

I think Cash ISAs as pure savings vehicles are poor value at the moment. I have been using them for some years to build up a lump sum to help pay-off my mortgage. This was fine when the ISA interest rate was higher than my mortgage interest rate, but now it's not. So I've used some of this cash to pay-off as much as my mortgage as possible without incurring charges. The amount my mortgage has dropped because of this payment is now going into the cash ISA. So, if you like, that sum of money is paying me interest at my mortgage rate.

I would never consider paying a lump sum into a Stocks & Shares ISA, since the timing of the investment makes a big difference, and my crystal ball has been playing up recently.:D

However, I am worried that my policy to pay-off my mortgage (early 2013) is affected by the current down turn, so I'm stuffing an extra £150 per month into a Stocks & Shares ISA. A monthly investment irons out the ups and downs and I should do quite well (which I need to) if the worlds economy has recovered by them. If not then I might as well head for the nearest hill, make a bonfire out of all my documents and start howling at the moon!:rotfl:

If were to put this money into a Cash ISA, assuming the same rate of investment and an average interest rate of 2.5% (the rate recovering over time), I'd have just over £8,000, £400 of which is interest. Using a Stocks & Shares ISA is much more risky but with an average yield of 10% (once the recession is over I think the rebound will be quite high), I'd have just over £9,500, £1800 of which is yield. I really need to generate that sort of money if I get close to paying-off my mortgage.

So this is a different type of risk.
Cash ISA:

• low capital risk
• high risk of low return and even erosion of capital value

Stock & Shares ISA (short term)

• high capital risk
• high risk of low return and even erosion of capital value

Stock & Shares ISA (medium term)

• medium capital risk
• medium risk of low return and even erosion of capital value

Stock & Shares ISA (long term)

• low capital risk
• low risk of low return and even erosion of capital value

Medium term is at least 5-10 years. So you can see I'm just within the high risk area for an extra £1400, which is only 9 months payments. However I feel this is the best time for this type of approach.

So, sorry for the long-winded reply, but it's a complicated question and everyone reading this will have their own, valid opinion on what's best for them. You just need to understand what you want, when you want it, what the risks are and how much risk you're willing take. By the way, I'm investing in funds not shares, that would be way too risky even if I had the knowledge and the time.

sammybee

i' got an isa last yr with A & L ive got about £3,200 in it, does any1 know which the best provider is to take out a new one with and transfer these funds too.
ive read the feeds of martin and theres not many there that r not fixed for a few yrs, i cannot do a fixed1 under present circumstances
samxxx.

Sisyphean_Task

I think this having to open another account with a bank just to have an ISA is a nasty trick.

They will no doubt start charging a fee for bank accounts soon so you could mess about transferring ISA funds for a better variable rate. Then the rate drops, then they stick you with a fee for the other account.

bummer007

RBS cash ISA plus, any good?