Don't quite max out your ISA?

traindaddy1960

I'm regretting maxing out my ISA allowance this year with a non-flexible account because it's preventing me opening and funding better deals which have become available. In future I'm planning to leave a few £ spare so I can open better accounts then add more funds when the new financial year starts. Does this make sense? 

tacpot12

Only from a convenience perspective, but by the time you are able to fund the new ISA, who is to say that an even better deal will not be available. I think I would just wait until I had the money and then choose where to deposit it. You might also consider whether fixed rate deals are suitable for you if you can't cope with not being able to move your money around. 

Northern_Wanderer

Can't you open the new account and do a transfer in? Or do you mean you have maxed out in a fixed deal? Usually a flexible ISA is one that you can withdraw from and top back up to your annual allowance. You can open multiple ISA in current tax year as long as you don't invest more than your annual allowance.

I have for this to be moved to the ISA forum, it's not "Site Feedback"

JohnB47

traindaddy1960 said:

I'm regretting maxing out my ISA allowance this year with a non-flexible account because it's preventing me opening and funding better deals which have become available. In future I'm planning to leave a few £ spare so I can open better accounts then add more funds when the new financial year starts. Does this make sense? 

I was thinking the same thing recently.

I opened a Trading 212 variable cash ISA and had to wait until my funds from another ISA were transferred in because I had used up my yearly allowance. I was worried that I would forfeit the bonus rate on the new ISA, which was held for 10 days. In the event the transfer happened four days after the request, so there wasn't a problem.

At that point I wondered if it would be useful to make sure not to totally max out an ISA , so as to leave a bit of allowance to be able to open a new ISA quickly. Not sure if it's worthwhile though or how much allowance would be useful to leave anyway £1, £100?

refluxer

traindaddy1960 said:

I'm regretting maxing out my ISA allowance this year with a non-flexible account because it's preventing me opening and funding better deals which have become available. In future I'm planning to leave a few £ spare so I can open better accounts then add more funds when the new financial year starts. Does this make sense? 

I'm not sure what the problem is and what you'd achieve by doing as you suggest ? As mentioned above, if you've paid all of your allowance into an easy access cash ISA and a better deal comes along later, then you can simply open the new account and transfer your funds into it. The fact that the existing ISA isn't flexible doesn't matter.

This is less likely to be an issue with interest rates heading downwards, though.

PRAISETHESUN

What ISA have you opened? There's no longer any restrictions on being able to only open and contribute to one ISA each year. As above, as long as your current ISA account is not a fix then you should be able to open a flexible ISA with another provider and initiate an ISA transfer to the new account. Even if it is a fix you can still transfer, subject to the withdrawal penalties.

saajan_12

traindaddy1960 said:

I'm regretting maxing out my ISA allowance this year with a non-flexible account because it's preventing me opening and funding better deals which have become available. 

Flexibility just means you can withdraw the money outside ISA world, do whatever with it, and then replace it into the same flexible ISA within the tax year. It doesn't affect whether you can transfer out of the ISA to another ISA. Do you mean that you opened a fixed term ISA? 

traindaddy1960 said:

In future I'm planning to leave a few £ spare so I can open better accounts then add more funds when the new financial year starts. Does this make sense? 

Why not just open the account in the new year when you have the money to add? Most fixed deals would only let you fund them for a few weeks after opening, not leave it open ended. So at most this would only help if there was a better deal in the last few weeks of the finanical year.