Flexible cash ISA - withdrawing interest

MotoRacer

slinger2 said:

MotoRacer said:

It’s Showing me payments interest on cash 3rd April £32.18  & 3rd May £131.98 …..so we saying I’ll be able to withdraw it and not show the cash value reduced below my initial £20,000 investment?  I don’t have to wait a year before I can take the profit out do I ?

No you don't have to wait. Assuming that it's an easy access account you can take out £164.16 if your wish. Or you can take out £60 or £600, that's up to you. What you take out is taken off your balance of course. Now because it's a flexible ISA you are allowed to replace that money later in the tax year without it counting towards your annual allowance. So the system takes the £164.16 off the allowance so that you can replace it if you want. Exactly the same happens if you withdraw £60 or £600. I know you're determined to think of the £164.16 as the interest but to the ISA it's just money being taken out. At the end of the day it's basically just a savings account.

Yes easy access . But I was concerned if it comes off the ISA £20000 total as it shows on the app . It will reduce the interest I make each month!  That’s why I was assuming I could just take the £164.16 Interest made and not impact the isa £20000 total…….. I can’t even see a way to move the £164.16 into the isa and do it that way. 

slinger2

MotoRacer said:

slinger2 said:

MotoRacer said:

It’s Showing me payments interest on cash 3rd April £32.18  & 3rd May £131.98 …..so we saying I’ll be able to withdraw it and not show the cash value reduced below my initial £20,000 investment?  I don’t have to wait a year before I can take the profit out do I ?

No you don't have to wait. Assuming that it's an easy access account you can take out £164.16 if your wish. Or you can take out £60 or £600, that's up to you. What you take out is taken off your balance of course. Now because it's a flexible ISA you are allowed to replace that money later in the tax year without it counting towards your annual allowance. So the system takes the £164.16 off the allowance so that you can replace it if you want. Exactly the same happens if you withdraw £60 or £600. I know you're determined to think of the £164.16 as the interest but to the ISA it's just money being taken out. At the end of the day it's basically just a savings account.

Yes easy access . But I was concerned if it comes off the ISA £20000 total as it shows on the app . It will reduce the interest I make each month!  That’s why I was assuming I could just take the £164.16 Interest made and not impact the isa £20000 total…….. I can’t even see a way to move the £164.16 into the isa and do it that way. 

With the interest already added you have £20164.16 in the ISA (I'm assuming the interest is being added to the ISA), so you're now getting interest on £20164.16. If you take out the £164.16 you'll get less interest since you'll only get interest on £20,000. So taking anything out will reduce the balance and reduce the interest you get too.

Remember that the interest you get depends on how much money you've got in the account. It doesn't matter whether that was originally capital or interest, it's just money now.

wmb194

MotoRacer said:

slinger2 said:

MotoRacer said:

It’s Showing me payments interest on cash 3rd April £32.18  & 3rd May £131.98 …..so we saying I’ll be able to withdraw it and not show the cash value reduced below my initial £20,000 investment?  I don’t have to wait a year before I can take the profit out do I ?

No you don't have to wait. Assuming that it's an easy access account you can take out £164.16 if your wish. Or you can take out £60 or £600, that's up to you. What you take out is taken off your balance of course. Now because it's a flexible ISA you are allowed to replace that money later in the tax year without it counting towards your annual allowance. So the system takes the £164.16 off the allowance so that you can replace it if you want. Exactly the same happens if you withdraw £60 or £600. I know you're determined to think of the £164.16 as the interest but to the ISA it's just money being taken out. At the end of the day it's basically just a savings account.

Yes easy access . But I was concerned if it comes off the ISA £20000 total as it shows on the app . It will reduce the interest I make each month!  That’s why I was assuming I could just take the £164.16 Interest made and not impact the isa £20000 total…….. I can’t even see a way to move the £164.16 into the isa and do it that way. 

It's just a savings account with a tax free wrapper. Because it's a flexible Isa the app is just telling you that you can replace your withdrawals this tax year if you want to.

Staffs2016

MotoRacer said:

Hi . I’m new to this ! 

Have a 20kflexible cash isa in 24/25yr and a 20k in 25/26yr both with T212 and thought I could withdraw the money made each month to help me poor wages. 

But I see my cash isa pot going down when I do this !!!   Do all these flexible cash isa do this? Can anyone shed any other way to achieve the initial idea or is this not allowed ….does a chip isa do the same?

Apologies if I am missing something but if you want to boost your wages with interest payments while maintaining your original sum invested then why not move to a provider with the option for interest to be 'Paid away' straight into your nominated bank account?

Vida Savings for example are offering 4.53% currently but there are loads of others (including fixed terms) available that enable you to utilise your ISA's as an income to replace or boost your monthly income, you can split your ISA's to maintain flexibility so you don't put all of your eggs into one basket so to speak.

Clearly it isn't one size fits all so it really depends upon what it is you are trying to achieve AND it is always best to think of any other future requirements to keep your options as flexible as possible.