ISA advise for this crazy time

javixeneize

Hi
My ISA matures in April and i need a bit of advise about how to move next. I dont know if i should pick an ISA right now for 1 year (the max i have seen is 0.55%) or should i wait a couple of months as maybe the economy will recover and the interest rate will be better.

What would be your advise?

Thanks

colsten

You won't get any financial advice here, just opinions.

To get opinions, you'd need to provide more information, such as when you plan to spend the money, whether you are planning to add to it, what other savings or investments you have, whether you are a BR or HR taxpayer, whether you would consider an S&S ISA etc.

If you are just after opinions on whether interest rates may rise soon: I don't think they will. OTOH, they might.

Eyeful

Your guess is as good as anyone's. That includes the so called "experts" that pontificate on radio and TV about the economy! Just do what you think is best. You may be right, wrong or a bit of both.

masonic

There is no reason to think interest rates will rise significantly in the next couple of months.

ranciduk

masonic said:

There is no reason to think interest rates will rise significantly in the next couple of months.

Months?

decades surely?

bd10

Personally I expect rates to stay low, they might pick up a little as is priced in by the money market, but 10-20bp from here is hardly a get-rich-quick scheme. Real rates will stay negative for quite a while. If I had the choice between a fixed and variable savings rate, I'd pick the variable (for same tenor of course, all else being equal and ignoring credit risk) or look for yield/income elsewhere.

javixeneize

Yep, i understand it is just an opinion, no worries about that. 
I dont intend to spend that money short term, i have been building some money in the ISA for some years, so i want to keep doing it. I thought on moving that to a saving account but i think its better to keep it in an ISA as its tax free isnt it?
So, in your opinion the interest on an ISA now and in september would be similar, right?

masonic

javixeneize said:

Yep, i understand it is just an opinion, no worries about that. 
I dont intend to spend that money short term, i have been building some money in the ISA for some years, so i want to keep doing it. I thought on moving that to a saving account but i think its better to keep it in an ISA as its tax free isnt it?
So, in your opinion the interest on an ISA now and in september would be similar, right?

Premium bonds are tax free and are highly likely to return more than a cash ISA. It depends how much you have saved in your ISA as to whether it would be very difficult to put it back should things change.

javixeneize

thats the thing, i have savings for several years, around 70k

masonic

javixeneize said:

thats the thing, i have savings for several years, around 70k

The maximum for Premium Bonds is £50k anyway, but £40k could be returned to an ISA quite quickly (either side of a tax year end). The risk is ISA contribution limits are reduced, but it's a fairly small risk.

£70k is a lot to hold in cash if you have no plans to spend it for the foreseeable future. You could consider investing some of it.

Doshwaster

javixeneize said:

thats the thing, i have savings for several years, around 70k

Do you really need £70k in cash? Consider moving some of it into your pension or stock market investments. Do you have a mortgage you could pay down?
I've just transferred a most of my Cash ISA money into Premium Bonds as my emergency fund but once you get above £10k or so cash make les and les sense as you are missing out on a lot of potential growth.  The Premium Bonds are there for guaranteed access to capital, prize money should beat cash savings and there's a tiny chance of a big win. Worst case scenario is missing out on a few pounds interest per grand per year.