Maturing Fixed Rate Cash ISA

SickGroove

Good morning,

So, I have 20K in a one fixed rate cash ISA with Charter, which matures on 06/04/24...

I have a about 2K currently sitting in an easy access cash ISA with gatehouse...

I'll be looking to put another 20K (24/25 allowance) into another cash ISA around the middle of May...

I would like to combine all into one cash ISA at that time so my question is...

Should I just let the Charter one automatically mature into their easy access cash ISA (I'm awaiting my maturity instructions to be emailed)

Once matured, can I then transfer the Gatehouse one into the matured Charter easy access cash ISA straight away (without it going towards my 24/25 allowance)

Then in the middle of May, can I also drop 20K either straight into the Charter easy access cash ISA or into a new one year fix with either Charter (or someone else who allows transfers in)?

Any advice appreciated, Cheers!

refluxer

SickGroove said:

Should I just let the Charter one automatically mature into their easy access cash ISA (I'm awaiting my maturity instructions to be emailed)

Yes, Charter's fixed rate cash ISAs 'become a variable rate ISA without any withdrawal restrictions' if you don't submit any maturity instructions, but you'll need to read the maturity letter carefully as it's likely that this will be one at a much lower rate to their current (5.08%) Easy Access ISA.

If you want that account specifically (which is advisable if the money is going to sit there for a month or two), then you might need to request that your matured funds are transferred into it. If it's not possible to open the account as part of the maturity process, then you might have to open it yourself so that a transfer into that account becomes a maturity option (or the other option is to simply transfer fairly quickly from the default maturity account to that easy access ISA if you don't get the timing right). 

SickGroove said:

Once matured, can I then transfer the Gatehouse one into the matured Charter easy access cash ISA straight away (without it going towards my 24/25 allowance)

Then in the middle of May, can I also drop 20K either straight into the Charter easy access cash ISA or into a new one year fix with either Charter (or someone else who allows transfers in)?

Yes, you can transfer the Gatehouse ISA without it counting towards your 2024-25 ISA allowance. If your current Charter one year fixed rate ISA was funded with your full £20k 2023-24 allowance, then presumably your Gatehouse ISA contains subscriptions from previous tax years ? Either way, it probably doesn't matter if you're looking to do all of this in the next tax year (after 6th April). Note that some of the current, restrictive ISA rules actually change on 6th April, so it would be worth reading up on the changes if you haven't already.

If you're wanting to put all of the ISA funds you've mentioned into one combined fixed rate ISA, it's worth bearing in mind that fixed rates could easily fall in-between you getting your current £22k into an easy access ISA (early April) and the time you said your 2024-25 allowance would become available (mid-May) so there's a chance you could lose out by waiting.

If I was in your position (and rates continue to fall between now and then), I would probably take out one fixed rate in early April with the current £22k and another in May with your 2024-25 allowance, rather than waiting to combine them.

Alternatively, there are a few providers (eg. Barclays and Shawbrook) who allow continued deposits throughout the duration of the fixed term so if you were to open a fixed rate ISA with them, then you'd be able to pay your 2024-25 allowance into it at a later stage. This would obviously be beneficial if rates were to fall in the meantime.

 

SickGroove

Thanks for all the advice...

Think I'll probably just renew my current 20K with charter for another year once I get the maturity options through...

My Gatehouse is surplus from previous years so I'll probably transfer that into the new one I'll be taking out in mid May with my 20K allowance for 24/25. 

I believe BOE rates are holding again on Thursday, so I might take out the new one around 20th April, if it has a 30 day funding window just incase the rates fall before then.

PeskyBlunder

You might find that the interest rates on the maturity options offered to you are lower than those offered to new savers - if that is the case you can open one of those those generally available and then do the transfer once your existing ISA has matured. This happened to me quite recently and their rates have gone up even higher now.