Cash ISAs: if you open one, are you stuck with it? 3 November 2022 at 1:05PM in ISAs & tax-free savings 2 replies 173 views

italo

Apologies if this question has already been asked. I am new to the forum and not sure...
As interest rates keep changing - and right now increasing - if I open a cash ISA for the current year, am I then stuck with it until April 2023 even if it becomes a poor choice in comparison with more recently launched ones?
So, say I open an ISA and pay £5000 into it with a 2% interest rate that at that moment looks fine. Then rates go up and other products offer much higher returns. Do I need to wait until the new fiscal year to open a new one, and move the cash?
With normal savings accounts I can move the money as much and often as I like, but does a cash ISA prevent this?
many thanks!

refluxer

No, you wouldn't be stuck with it and would be free to transfer it to a new provider, subject to the T&Cs and any penalty due (if it's a fixed rate ISA and you're transferring before the maturity date - transferring from an easy or limited access account should be penalty-free).

You can open as many cash ISAs as you like but you can only pay 'new money' (from the current tax year) into one cash ISA at any one time so, in the context of your question, you could open a new ISA today and pay money into it but you would need to transfer the whole amount to a new ISA in order to continue paying into it (up to the £20k maximum allowance).

Albermarle

Apologies if this question has already been asked. I am new to the forum and not sure

Suggest you read through the forum as every conceivable question about ISA's has been asked and answered numerous times.

With normal savings accounts I can move the money as much and often as I like

Not if it is a fixed rate/fixed term  account.