ISAs for beginners

Alex_Ramsay

Hi - I received an inheritance earlier this year. At the moment it is sitting in a fixed limited access savings account receiving 4.53%. I can make one further withdrawal with no penalty. Presumably it would make sense to transfer as much as I'm allowed into an ISA? The same bank is offering a fixed rate cash ISA for one year at 4.7%. Advice very welcome, as I'm a beginner in this world.

eskbanker

ISAs are usually useful in sheltering savings from taxation, but it's a far from a universal golden rule and much will depend on your wider financial circumstances, when you're likely to need the money, etc.

Alex_Ramsay

eskbanker said:

ISAs are usually useful in sheltering savings from taxation, but it's a far from a universal golden rule and much will depend on your wider financial circumstances, when you're likely to need the money, etc.

Thanks - I shan't need the money until around this time next year, when I shall have some renovations to do

amanda1024

Alex_Ramsay said:

eskbanker said:

ISAs are usually useful in sheltering savings from taxation, but it's a far from a universal golden rule and much will depend on your wider financial circumstances, when you're likely to need the money, etc.

Thanks - I shan't need the money until around this time next year, when I shall have some renovations to do

If you pay enough tax to make an ISA worthwhile, if you're quick it might be worth withdrawing £40k in one go, and putting £20k into an ISA immediately and another £20k next tax year. 4.7% is a fairly decent rate; you can get over 5% if you shop around (but might have timed out for adding money this year) https://www.moneysavingexpert.com/savings/best-cash-isa/