Advice please for an ISA that is maturing at the end of May 2022

Tabby026

Hi,

I have a £40,000 ISA maturing in May 2022.  My query is with rates so low, do I do another ISA with the money or put it somewhere else? It has taken a lot to save up this money, so I would like some interest from it.  I would like a low risk product just in case we need the money in the future, as my husband has a stocks and shares ISA. Any advice would be greatly appreciated, Thanks in advance.

eskbanker

Depends what the money is likely to be needed for and when - if it must stay in cash form then as you say, rates are low, but conversely there's no point in investing it if it's likely to be needed in the next few years.  No need to be all or nothing, you could invest some and save the rest.

Or pension is another possibility for anything you'd be happy to tie up until 55+....

Tabby026

Just a query If I set up a private pension with it, would there be fees involved? I am paying into a work pension, so hadn’t thought about setting up a private one. Im 48 years old.  

eskbanker

Tabby026 said:

Just a query If I set up a private pension with it, would there be fees involved? I am paying into a work pension, so hadn’t thought about setting up a private one. Im 48 years old.  

Yes, there'd be fees involved, but that shouldn't be hugely significant:

https://www.moneysavingexpert.com/savings/cheap-sipps/

Albermarle

Tabby026 said:

Just a query If I set up a private pension with it, would there be fees involved? I am paying into a work pension, so hadn’t thought about setting up a private one. Im 48 years old.  

Why not just add to your workplace pension ? If it is  a standard DC scheme then most would be happy to accept lump sums direct from you .
You will gain tax relief on any new contributions , but you will be limited by how much you earn on how much tax relief you can get. Maybe you might need to make a lump sum payment before April 5th and one after . Also there is a limit of £40K on the total amount that go into a pension in one tax year.
Pension is usually best if you are saving money for retirement/later life .
This is a good resource of info .
Pensions and retirement | Help with pensions and retirement | MoneyHelper

If you want to continue to save some of it for quicker access , then you might need to keep that money in a cash ISA.
If you are a basic rate taxpayer you can earn £1000 in interest tax free and non ISA savings accounts tend to pay higher interest.
Compare The Best UK Savings Accounts | moneyfacts.co.uk

MEM62

Tabby026 said:

Just a query If I set up a private pension with it, would there be fees involved? I am paying into a work pension, so hadn’t thought about setting up a private one. Im 48 years old.  

If you have a works pension there is no need to set up another one.  Just pay the money into your work pension.  

P1Fanatic

Re: paying into your works pension you should automatically get lower rate tax relief added but if you are a higher rate tax payer you will have to claim the additional tax relief.

jimjames

MEM62 said:

Tabby026 said:

Just a query If I set up a private pension with it, would there be fees involved? I am paying into a work pension, so hadn’t thought about setting up a private one. Im 48 years old.  

If you have a works pension there is no need to set up another one.  Just pay the money into your work pension.  

The OP hasn't specified what sort of work pension they have. If it's a DB then paying extra in might not be possible. Even a DC scheme might not accept additional payments outside the company contribution route or might be limited. All things to investigate.

@Tabby026 remember if you pay into the pension you are limiting access to at least 7 years, possibly 9 based on your age and you had suggested you might need to use the money sooner.

Thrugelmir

A lot could happen to interest rates in the next 3 months. Watch this space as they say. Inflation ultimately will fall away.