How will I get my money out of SS ISA?

luci

We've had S&S ISAs for 13 or 14 years through an IFA. I just draw down money as and when we need it, usually for home improvements. The rest stays in, continuing to grow.

Ms_Money_Penny

I agree that it is terrible that you can’t withdraw money out of your S&S ISA until after age 65. I want to be able to draw on this ISA at 60 as my pension and feel that I might need to transfer a chunk of money to a cash ISA instead while we still can before April 27.

booneruk

https://forums.moneysavingexpert.com/discussion/comment/82058547#Comment_82058547

What? I've not seen anything suggesting withdrawals from ISAs until you're 65 won't be allowed. Maybe you're thinking about pensions, and the age there is 57

If you mean 'cant move money from S&S into Cash ISA until I'm 65' then that's wide of the mark too. You'll have a 12k cash ISA allowance every year, so nothing stopping you withdrawing 12k from S&S and depositing it into cash ISA if that works for you

Yorkie1

https://forums.moneysavingexpert.com/discussion/comment/82058547#Comment_82058547

I think you have misunderstood something somewhere.

You can sell funds in your S&S ISA and then either a) withdraw the cash to a non-ISA account; b) hold the sale proceeds as cash in the ISA; c) reinvest in something else in the ISA; or d) transfer the funds proceeds to a cash ISA.

If you are not yet 65 and will not turn 65 in a current tax year, you will have a 22% charge on on any interest arising from the cash in option b), and you cannot do d).

So if your plan is to withdraw funds from your S&S ISA which you will spend on living, the proposals make no difference to your ability to do that.

masonic

https://forums.moneysavingexpert.com/discussion/comment/82058547#Comment_82058547

This is not true. You can withdraw money from a S&S ISA at any time. It is an absolute right enshrined in the ISA regulations and is not going to change. This is what makes the S&S ISA so valuable for those wishing to retire early - it can fund the years before you are able to access your pensions.

DiamondLil

https://forums.moneysavingexpert.com/discussion/comment/82058547#Comment_82058547

Good lord, where on earth did you see that misinformation ?

DiamondLil

https://forums.moneysavingexpert.com/discussion/comment/82058245#Comment_82058245

Same here - during all those years of low interest rates on savings I saw no point in keeping cash. I sell stock whenever I need more cash than I have in the bank account.

seacaitch

Ms_Money_Penny's misunderstanding above is why politicians should — but very rarely do — think very carefully before fiddling with and complicating yet further the vehicles we use for longer term saving, investing and retirement provision…

Instead of more people being gently steered into using S&S ISAs for longer term saving, as was Govt's stated intention, the main takeaway of these changes for half the adults in the country will probably be that investment ISAs are now going to be taxed and your money's somehow tied up until 65!

And as a result, they'll be even less likely to start investing. 🤦

Well done politicians and Treasury over-complicators!

InvesterJones

To give @Ms_Money_Penny the benefit of the doubt, it could be they are simply mixing up withdrawal and transfer to cash ISA

Withdrawal vs transfer is very commonly confused. They are entirely correct if they meant to say that they think it's terrible that you can't transfer from a S&S ISA to cash ISA until you are 65. Of course, ISAs used to be restrictive in the past as well, so it's not like we've not been there before to some extent, but if all you've known is the current freedom any loss of agency is bitter. However, as mentioned several times, there are workarounds.

eskbanker

https://forums.moneysavingexpert.com/discussion/comment/82062318#Comment_82062318

Seems like quite an extrapolation to take one poster's misunderstanding and translate that into being representative of half the adult population!

Granted, there are a number of others also suffering similar misunderstandings when posting on here, but probably worth remembering that these reforms are still work in progress, so it's not unreasonable to expect some lack of clarity during the design phase, and that there'll be better communication of the full picture once known.

And perhaps also worth bearing in mind that lack of understanding of how ISAs work is nothing new - for years there have been posts every March from people thinking that they can dump money into them (for a few days/weeks leading up to the change in tax year) and receive a full year's interest! And let's not even think about the misunderstandings of interest on regular savers (as another frequent example of financial ignorance, albeit not ISA-related as such)…