My First ISA

GE0RDIE

I find myself with some money to invest, for the first time.
If I put £20k into an ISA this year, could I do the same again in April, or do I have to wait a year?
I've noticed some are %5+. . does this mean £5 interest on every £100 per year? 
So I could turn £40,000 into £42,000 by April 2025?
Is it naïve of me to think I could continue getting 5% for the foreseeable future?

masonic

Yes, you get a £20k allowance to use whenever you wish within each tax year, so you do not have to wait beyond 6th April for the next £20k.

5% does indeed mean £5 per £100 interest per year, but remember that inflation will also reduce the value of the original £100, so it might not be quite as attractive as it appears. The best savings accounts have tended to deliver interest that is slightly ahead of inflation on average, although there are periods where interest was well below inflation (such as the past 18 months)

jimjames

GE0RDIE said:

I find myself with some money to invest, for the first time.

Just to be clear, you've stated invest but from the rest of your post it looks like you actually mean savings. Investments carry a degree of risk and you would need to open a S&S ISA not a cash ISA if you want to use investments. Also check whether an ISA will be of use to you which will depend on your tax situation.

Reed_Richards

jimjames said:

... Also check whether an ISA will be of use to you which will depend on your tax situation.

That's your tax situation both now and in the future; don't be short-sighted about this.  The more you save in an ISA, the more you earn and the greater the interest rate then the more likely you will benefit from having your money in an ISA.  Even if there is little tax benefit now there may be in future, and you can only add £20k per tax year to your ISA savings. 

Albermarle

GE0RDIE said:

I find myself with some money to invest, for the first time. I think you mean save rather than invest.
If I put £20k into an ISA this year, could I do the same again in April, or do I have to wait a year? You can add £20K per tax year.
I've noticed some are %5+. . does this mean £5 interest on every £100 per year? Yes
So I could turn £40,000 into £42,000 by April 2025? If you invested £20K today and £20K in April 2024, you would have a bit more than £42K
Is it naïve of me to think I could continue getting 5% for the foreseeable future? For easy access savings accounts the 5% will probably start to drift downwards next year. However you could get a fixed rate/fixed term account.

Answers in bold above. If you read through this forum you will be much better informed about savings and ISA's 
Also suggest you read this.
Savings - All Guides - MoneySavingExpert

GE0RDIE

Many thanks for the replies. Some great advice.
I did indeed 'save' 20k into a cash ISA. It matures tomorrow. At 5.03% it is now worth £20,945.79. 
The bank I'm with aren't competitive this year, so I'm going to transfer it into another ISA. I've just had a message saying that tomorrow my money will be transferred into an easy access account. I presume I can transfer it easily into any new ISA that I set up?
I'm looking at Trading 212 as at 4.9% it's seems to be the best rate. Plum offer 5.18% but it is 'variable' I'm assuming that means it isn't guaranteed for the year?
Having made my first £1000 (almost) and had some luck with Premium Bonds, my attitude to risk has changed slightly. I'm more prepared to take risks. With this in mind, should I consider a stocks and shares ISA? How do I compare them and choose a suitable one?
I've had £40k worth of Premium Bonds since march and made £1450 which I think is roughly what I'd get if it had been in an ISA. I'm torn between putting 20k into an ISA before april and another 20K after april (so I'd have 60k in an ISA) or just keeping the 40k bonds and hoping I'm lucky. I realise I'll get interest on the interest with an ISA , but there's the possibility I'd need to dip into it next year (as I'm on a very small pension at the moment, retired but only 60 so no state pension).
Any advice gratefully received. 

PartySausage

The Trading 212 Cash ISA is also variable and has dropped from the 5.2% when I opened mine in August.
They are also about to change their interest from daily to monthly 

eskbanker

GE0RDIE said:

Many thanks for the replies. Some great advice.
I did indeed 'save' 20k into a cash ISA. It matures tomorrow. At 5.03% it is now worth £20,945.79. 
At 5.03% AER it should have earned over £1,000 in interest over a year, is there a further payment to be added or was the term less than a full year?

The bank I'm with aren't competitive this year, so I'm going to transfer it into another ISA. I've just had a message saying that tomorrow my money will be transferred into an easy access account. I presume I can transfer it easily into any new ISA that I set up?
Not literally any, but most ISAs will accept inward transfers.

I'm looking at Trading 212 as at 4.9% it's seems to be the best rate. Plum offer 5.18% but it is 'variable' I'm assuming that means it isn't guaranteed for the year?
As above, they're both variable and that Plum rate doesn't apply to transferred funds, so you need to check terms carefully.

Having made my first £1000 (almost) and had some luck with Premium Bonds, my attitude to risk has changed slightly. I'm more prepared to take risks. With this in mind, should I consider a stocks and shares ISA?
No, IMHO - the sort of risk involved in premium bonds bears no relation to that with investing, so isn't any form of preparation.

Some comments above....

GE0RDIE

eskbanker said:

GE0RDIE said:

Many thanks for the replies. Some great advice.
I did indeed 'save' 20k into a cash ISA. It matures tomorrow. At 5.03% it is now worth £20,945.79. 
At 5.03% AER it should have earned over £1,000 in interest over a year, is there a further payment to be added or was the term less than a full year?

Some comments above....

Thanks again.
I was wondering why it was less than £1000 interest. 
To my simple mind, 5.03% is £503 per £1000 per year. So should have made £1006
It matures tomorrow so maybe there's one months interest to be added. 

As for my next move, I'm tempted to stay with my current ISA provider and get 4.3% fixed. My account is set up and there isn't a great difference between 4.3 and 4.9 (plus the 4.9 is variable). 

GE0RDIE

eskbanker said:

GE0RDIE said:

Many thanks for the replies. Some great advice.
I did indeed 'save' 20k into a cash ISA. It matures tomorrow. At 5.03% it is now worth £20,945.79. 
At 5.03% AER it should have earned over £1,000 in interest over a year, is there a further payment to be added or was the term less than a full year?

Some comments above....

The interest was paid monthly, and the year was up yesterday, so it is indeed over £1000 in interest. 
1,032.39 to be exact, with final months interest going in yesterday. 

jimjames

GE0RDIE said:

eskbanker said:

GE0RDIE said:

Many thanks for the replies. Some great advice.
I did indeed 'save' 20k into a cash ISA. It matures tomorrow. At 5.03% it is now worth £20,945.79. 
At 5.03% AER it should have earned over £1,000 in interest over a year, is there a further payment to be added or was the term less than a full year?

Some comments above....

Thanks again.
I was wondering why it was less than £1000 interest. 
To my simple mind, 5.03% is £503 per £1000 per year. So should have made £1006

I assume you really mean £503 per £10,000 and your mind isn't really thinking you'd get 50% of your capital as interest