First time ISA user and have failed to under stand it - what are my options please

Just_A_Dad

Hi there,
So I opened a first ISA in April - a santander fixed rate 12 month one @ 4.15% interest.
I opened it with 10K 
I took it that I could add funds to it during the year up to the limit of 20K 
so looking to add left over money to it each month.
That was ok in April and May and June - whereby I could transfer additional money which i did.
Today , not able too transfer funds - and Santander have told me it was closed to additional funding after 31st May (although for some reason my payment on 21st June when through ok)
So my question is - what can I do now and make best use of the money that is in this ISA - but also what else ca nI do with the money I've trying to save each month (about 150-450 per month)

Thanks.

Catplan

ISA options, transfer to another ISA will be a penalty 120 days interest I think on Santander fixed ISA, but check the t&c’s.  If you transferred to an easy access / flexible cash ISA you should be able to fund it monthly but do your own research.

Check this link https://www.moneysavingexpert.com/savings/isa-switch-calc/

run the figures before transferring.

Other options
Leave fixed ISA, save in a regular saver your monthly funds, this will mean the regular saver is outside the ISA so potentially subject to tax. 

Leave fixed ISA, save rest of ISA contributions in stocks and shares ISA. 

If it were me, and I wanted to utilise the 20k, I’d probably be taking the hit on fixed rate penalty and transferring to a more suitable product. Most fixed rates have a limited funding window, again they usually come with a penalty for ending early. 

I’m sure they’ll be other options but these are the ones that spring to mind.

jimjames

Do you actually need an ISA this year? If your total capital is £10k and that's already inside an ISA then the additional each month could easily be paid into a regular saver account and that won't generate enough to be taxable unless you're an additional rate taxpayer.

Just_A_Dad said:

I took it that I could add funds to it during the year up to the limit of 20K  what else ca nI do with the money I've trying to save each month (about 150-450 per month)

First thing for future accounts is to carefully read the conditions, luckily this issue doesn't affect you getting your money but on some accounts it might well have done so worth making sure you fully understand the restrictions before you open it.

Bigwheels1111

Open a new ISA by transfering it over.Pay the fine to leave.

120 days' interest fine =£136.43.

These are the best rates today, click rate order.

https://moneyfactscompare.co.uk/isa/fixed-rate-isas/?quick-links-first=false

Im with a Virgin money 3 year ISA, Not the best today but has been for the last month or two.

Like many others on here we are playing the ISA shuffle with Virgin.

I opened my 3 year ISA at 5.2% three weeks ago.

Once onened I funded it the same day, I was given a 14 cooling off period.

10 Days later rates went up, Into my Virgin ISA account I went.

Selected new savings, 3 year 5.5% ISA, fund with old account etc and bingo I now get 5.5%.

This mornig I did the same again for 5.55%, Thus insuring I could move again if rates rise

when the BOE sit in 13 days. So far Im £105 + compounded interest better of for ten minutes work.

As for extra saving I would go with Chip, If you sign up for there open banking Deposits and withdrawls are instant and 4.51% easy access.

Doctor_Who

You can normally only pay into a fixed rate ISA for a defined window, I'm surprised the Santander window was that long. You can just leave the Santander ISA alone and it will mature in April 2024 or you can transfer it (a full transfer) somewhere else. If you transfer it there will be a fee for early closure (check the T&Cs). You can't open and subscribe to another cash ISA this tax year with the Santander ISA still being open. You could open a stocks and shares ISA for the monthly savings or use a regular saver (non-ISA) account.

Albermarle

Just_A_Dad said:

Hi there,
So I opened a first ISA in April - a santander fixed rate 12 month one @ 4.15% interest.
I opened it with 10K 
I took it that I could add funds to it during the year up to the limit of 20K 
so looking to add left over money to it each month.
That was ok in April and May and June - whereby I could transfer additional money which i did.
Today , not able too transfer funds - and Santander have told me it was closed to additional funding after 31st May (although for some reason my payment on 21st June when through ok)
So my question is - what can I do now and make best use of the money that is in this ISA - but also what else ca nI do with the money I've trying to save each month (about 150-450 per month)

Thanks.

Perhaps worth making clear that even if the fixed rate savings account was not an ISA, you still can not normally add to them after a fixed initial period.

Just_A_Dad

Albermarle said:

Just_A_Dad said:

Hi there,
So I opened a first ISA in April - a santander fixed rate 12 month one @ 4.15% interest.
I opened it with 10K 
I took it that I could add funds to it during the year up to the limit of 20K 
so looking to add left over money to it each month.
That was ok in April and May and June - whereby I could transfer additional money which i did.
Today , not able too transfer funds - and Santander have told me it was closed to additional funding after 31st May (although for some reason my payment on 21st June when through ok)
So my question is - what can I do now and make best use of the money that is in this ISA - but also what else ca nI do with the money I've trying to save each month (about 150-450 per month)

Thanks.

Perhaps worth making clear that even if the fixed rate savings account was not an ISA, you still can not normally add to them after a fixed initial period.

Hi there, the only wording was that a deposit had t obe made within 60 days, there was nothing particularly clear that said after this 60 day period finished there could be no more 'additions'

As I say ISA's are very new to me and I'm struggling to see what I can do now and then in the future with it etc

Beddie

Just_A_Dad said:

Albermarle said:

Just_A_Dad said:

Hi there,
So I opened a first ISA in April - a santander fixed rate 12 month one @ 4.15% interest.
I opened it with 10K 
I took it that I could add funds to it during the year up to the limit of 20K 
so looking to add left over money to it each month.
That was ok in April and May and June - whereby I could transfer additional money which i did.
Today , not able too transfer funds - and Santander have told me it was closed to additional funding after 31st May (although for some reason my payment on 21st June when through ok)
So my question is - what can I do now and make best use of the money that is in this ISA - but also what else ca nI do with the money I've trying to save each month (about 150-450 per month)

Thanks.

Perhaps worth making clear that even if the fixed rate savings account was not an ISA, you still can not normally add to them after a fixed initial period.

Hi there, the only wording was that a deposit had t obe made within 60 days, there was nothing particularly clear that said after this 60 day period finished there could be no more 'additions'

As I say ISA's are very new to me and I'm struggling to see what I can do now and then in the future with it etc

You can leave it or move it and pay the penalty, as mentioned by another poster.

I'd leave it personally, but do the maths and decide if you want to move it.

If you leave the ISA where it is, save into Chip or similar (non-ISA) and move it into an ISA next April 6th.
For next year's ISA, build up the amount you want to fix (if you do want to fix) in a variable ISA then transfer it all in one lump sum to a new fix.
And for this fixed rate, you can transfer it when the term ends.

The important thing here is to save, wherever you put it, which you are doing.

Just_A_Dad

Beddie said:

Just_A_Dad said:

Albermarle said:

Just_A_Dad said:

Hi there,
So I opened a first ISA in April - a santander fixed rate 12 month one @ 4.15% interest.
I opened it with 10K 
I took it that I could add funds to it during the year up to the limit of 20K 
so looking to add left over money to it each month.
That was ok in April and May and June - whereby I could transfer additional money which i did.
Today , not able too transfer funds - and Santander have told me it was closed to additional funding after 31st May (although for some reason my payment on 21st June when through ok)
So my question is - what can I do now and make best use of the money that is in this ISA - but also what else ca nI do with the money I've trying to save each month (about 150-450 per month)

Thanks.

Perhaps worth making clear that even if the fixed rate savings account was not an ISA, you still can not normally add to them after a fixed initial period.

Hi there, the only wording was that a deposit had t obe made within 60 days, there was nothing particularly clear that said after this 60 day period finished there could be no more 'additions'

As I say ISA's are very new to me and I'm struggling to see what I can do now and then in the future with it etc

You can leave it or move it and pay the penalty, as mentioned by another poster.

I'd leave it personally, but do the maths and decide if you want to move it.

If you leave the ISA where it is, save into Chip or similar (non-ISA) and move it into an ISA next April 6th.
For next year's ISA, build up the amount you want to fix (if you do want to fix) in a variable ISA then transfer it all in one lump sum to a new fix.
And for this fixed rate, you can transfer it when the term ends.

The important thing here is to save, wherever you put it, which you are doing.

Thanks.

Here's a really silly question, my current ISA - at 4.15% - come April 2024 If I do nothing with this -will this interest rate hold at 4.15% or is it likely to jump up or down?

Also, come April 2024 say I will have my existing 10,3K plus its interest - plus hopefully separately in CHIP or Chase account another 30K for example - I can then open a brand new ISA (from any supplier?) and then fund it from my CHIP/chase savings - and 'transfer' the Santander fund pot into it - is that right?

Yes, saving is good - We did look at overpaying the mortgage - but we are now on a fixed rate of 3.18 for the life of the mortgage - therefore if I have my sums right - its better for us to save any overpayments in an ISA and then pay if off down the line... and just want to maximise what I'm doing.

Thanks for your help.

eskbanker

Just_A_Dad said:

Albermarle said:

Perhaps worth making clear that even if the fixed rate savings account was not an ISA, you still can not normally add to them after a fixed initial period.

As I say ISA's are very new to me and I'm struggling to see what I can do now and then in the future with it etc

But the point being made was that a limited deposit window applies both to ISAs and non-ISA taxable fixed term accounts, i.e. it's not an ISA-specific issue.

Just_A_Dad said:
the only wording was that a deposit had t obe made within 60 days, there was nothing particularly clear that said after this 60 day period finished there could be no more 'additions'

You could check the Ts & Cs that you signed up to, but the archived version of the relevant page as at 6 April is clear:

deposits can be made from 6 April 2023 up to and including 31 May 2023. No further deposits will be allowed.

http://web.archive.org/web/20230406152104/https://www.santander.co.uk/personal/savings-and-investments/isas/2-year-fixed-rate-isa

Doctor_Who

Here's a really silly question, my current ISA - at 4.15% - come April 2024 If I do nothing with this -will this interest rate hold at 4.15% or is it likely to jump up or down?

What do the T&Cs say? It's highly likely the ISA will become an easy access ISA with a lower rate (the rate won't increase!).

Also, come April 2024 say I will have my existing 10,3K plus its interest - plus hopefully separately in CHIP or Chase account another 30K for example - I can then open a brand new ISA (from any supplier?) and then fund it from my CHIP/chase savings - and 'transfer' the Santander fund pot into it - is that right?

Yes, open a new cash ISA with any provider and add upto £20K. If the new ISA allows transfers-in you can transfer the ~£10K from Santander (note any funding/transfer window in the T&Cs of the new ISA).