Cash ISA transfer to separate providers

rungku

Hi

I currently have £105K in a Nationwide cash ISA (£16K deposited last week) and recently realised that the interest rate is low so I am looking to transfer into another cash ISA with another provider. I don’t plan on needing the cash for the next year so was looking to transfer into a one year fixed cash ISA but wary about having over £85K with one provider. Is it possible to split the cash in my Nationwide cash ISA and transfer it into two separate cash ISAs (separate provider) so each has less than £85K?

Thanks

Malchester

Yes. As long as Nationwide allow partial transfers out and the receiving account allows partial transfers in.

Albermarle

I think Nationwide just announced some improvements in their cash isa rates . So worth double checking before doing anything , although their rates tend to be not that competitive normally.

Keep_pedalling

Why so much in cash? Cash ISAs have been poor value for many years now. If this is long term money then S&S ISAs or topping up pension provision would be a better home for most of those savings.

Bigwheels1111

I have two ISA, near the limit, can’t wait to get them out and into 2 year fixed rate bonds.
I hope by August and September the rates might be near 3%.
I don’t pay tax so better rates will benefit me.
5% fixed and I would not need to work until my pension pays out.

rungku

Thanks for all for your advice. Looking to use most of the amount to go towards a property in the next year or two, hence looking to keep it in cash ISA or savings. I should have taken action sooner (same cash ISA for the past 3 years), and perhaps learned more about investing vs savings.

Does anyone know if the current top one-year fixed ISAs from here allow partial transfer in?

MDMD

The one rule you need to abide by is the £16k contribution in the current year needs to be transferred in its entirety.

The prior tax year amounts you can split how you wish

masonic

What attracts to you keeping the ISA status of the money if you will be using most of it towards a property in the next couple of years? You'd probably be able to achieve a better net rate in a normal savings account. The drawback is you wouldn't be able to access at all within the term of a 1 year fixed term savings account, unlike an ISA where access would be permitted subject to an interest penalty. A notice account therefore might be more appropriate depending on how much flexibility you need to bring forward your house purchase.

If going for a partial ISA transfer, then the easiest way to check is by looking in the FAQ of the product you are interested in, or downloading the transfer form which would have options for partial transfers if supported.

rungku

Thanks you are right, transferring my cash ISA into two fixed normal savings accounts works out better in interest received. Is there any benefit in keeping my savings in cash ISA if I plan to use the savings in the next two years?

masonic

rungku said:

Thanks you are right, transferring my cash ISA into two fixed normal savings accounts works out better in interest received. Is there any benefit in keeping my savings in cash ISA if I plan to use the savings in the next two years?

Not really, people hang on to cash ISAs mostly in the fear that the personal savings allowance might be axed, or they might start having to pay higher rate tax. Over a short timeframe such as a couple of years, you can probably be reasonably confident as to whether either of these things is likely.

Notepad_Phil

rungku said:

Thanks you are right, transferring my cash ISA into two fixed normal savings accounts works out better in interest received. Is there any benefit in keeping my savings in cash ISA if I plan to use the savings in the next two years?

I'm assuming you'll be choosing an account with an interest rate greater than 1%, so £105k is certainly going to cause your personal savings allowance to be used up (even if you're just a basic rate tax payer). So make sure you take any taxation on your gross interest into account when comparing ISA versus normal savings accounts - though with interest rates on cash ISAs as they are, I suspect you will be better off with normal accounts, but better to be sure than not.