Nat West ISA or is there better?

Morning. 
I'll shortly be in a position to open an ISA with £20,000 and I'm looking at this one 
Fixed Rate ISA | ISA Rates | NatWest
The plan is this'll go towards paying off our mortgage in June 2026 when the current 1.75% fixed rate comes to an end.
We did consider clearing the mortgage now but as we can get 5.65% in the ISA presumably we'd be better letting the mortgage run and saving the money.

I have a couple of questions.... 

Term                   Balance      AER/Tax-free p.a. (fixed)

1 year issue 332     +£1,000          5.65%
2 year issue 333     +£1,000          5.65%

Is it better to fix for 2 years or just 1 hoping the rate will go up? Personally I feel this is unlikely so 2 years may be wiser.

It says the Maturity Date for the 2 year option in the 27th November 2025.
I thought ISA's were based on the tax year April to April?
So if I put in £20000 in November 2023, tax year 23/24, do I then need to wait til November 2024 to add another £20,000 or can I do that in April 24 as it's a different Tax year (24/25) ?
If so, could I then (if I were in a position to do so) add another £20,000 in April 2025?
Or does this, a fixed rate 2 year ISA only allow payments in on it's own anniversary? 
I hope that makes sense.


DEBT FREE - Feb '21
  • Mortgage March '21 -£130,000
  • Mortgage now - £81,187
  • Mortgage daily interest Nov £4.60 Dec £4.57 Jan £4.54 Feb £4.52 March £4.49 April £4.46 June £3.97 August £3.91

Comments

  • Albermarle
    Albermarle Posts: 21,225
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    If you read through this forum all these questions/misunderstandings should be easily cleared up.
    Also look for threads on NatWest ISA, there seems to be a lot of admin issues with it.

    I thought ISA's were based on the tax year April to April?
    Only the maximum contribution allowed is based on the tax year.

    If you opened a one year fix rate ISA today, then it will finish in exactly 12 months time. Normally with fixed rates you can only add money at the start, or within a fixed window ( usually 15 to 30 days). There are a handful where you can add money later but that facility can be withdrawn.


  • If you opened a one year fix rate ISA today, then it will finish in exactly 12 months time. 

    You would think that should be true but it often isn't.  Many fixed rate products that are nominally "one year" have a maturity date which is a bit longer than one year from the time when the product is open for new money.  Your interest is scaled up to account for this.


    It says the Maturity Date for the 2 year option in the 27th November 2025.

    Okay, two years in this instance, but an example of what I mean.
    Reed
  • Indout96
    Indout96 Posts: 2,338
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    edited 24 October 2023 at 12:58PM
    We have just fixed £40k for 2 years (£20k each me & wife), with a GE at the end of next year / start of 2025 I can see them throwing everything and the kitchen sink at bringing the interest rate down for mortgages but I have been wrong before :-(
    Totally Debt Free & Mortgage Free Semi retired and happy
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