Fixed rate low paying issa

hardink1

Is it worth paying a 120 day penalty fee on a issa paying 1.5 , to fix for a year at 3.5

Kthecat

Wrong forum. Thus is for competitions only. 
To answer your question
1 are you going to need the money quickly e.g. emergency
2 can you get same or better rate elsewhere 
If answer to either is yes I wouldn't 

Albermarle

There are many threads discussion the same thing on this forum and this subforum.ISAs & tax-free savings — MoneySavingExpert Forum

The key point is how long as your current fixed rate got to run and/or will a year fix have a higher rate in the near future.

EthicsGradient

The 120 day penalty is basically a third of a year's interest, so it's 0.5%. That means it's almost certainly worth paying it to get something better (assuming you still have a significant amount of time to run in that fixed rate ISA); the top instance access ISA today pays 2.25% (which, if you think rates might go up again, and you're willing to keep checking how rates are doing and do 2 transfers could be useful as a temporary home for your money), and the best 1 year 3.85%. If you're OK with a new year starting on how long you're likely to keep the money there, of course.

Neil_Jones

hardink1 said:

Is it worth paying a 120 day penalty fee on a issa paying 1.5 , to fix for a year at 3.5

One of the beauties of cash ISAs is that they must be easy access, they aren't "fixed" in the same way as fixed non-ISA savings are (ie the latter if you tie up for 5 years that's it, you can't get access to it for five years, end of discussion).  That's what the penalty is for on the ISA to dissuade, but not completely stop.

A lot will depend on when your ISA rate runs out and how long you've had that particular account, but on paper it looks worth it.  As above if you'e earned a third of the annual interest already then that will have the same effect as just having earned no interest.

hardink1

Thanks all , I'll do the maths x