Chip Cash ISA transfer plan

LankyMoneySaver

Would appreciate people's feedback and suggestions on my plan for transferring away from Chip's Cash ISA now the interest rate has dropped to 1%.

1) Transfer Chip Cash ISA > Chip Smart ISA 3.75%
REASON:
Pending interest accrued but not yet paid on Cash ISA will be transferred.
Believe I'd lose this if transferring direct from the Cash ISA to another provider?

https://help.getchip.uk/help-article/changes-to-the-chip-cash-isa?abExternalOpen=true

You won't lose interest that has accrued but not yet been paid in the Chip Cash ISA when you transfer it to the Smart Cash ISA. Any pending interest that's accrued but has not yet been paid will be transferred over at the same time as your balance.

Then:

2) Open Trading 212 cash ISA
3.6%, but 4.51% on new money and 'deposited in the current tax year.'

3) Partial transfer this year's contribution (£15k) from chip smart ISA to T212 to earn increased interest on this, leaving previous year's contributions at higher 3.75% Chip.

https://www.moneysavingexpert.com/savings/best-cash-isa/#what

The bonus rate only applies to new money you pay in and transfers of cash deposited in the current tax year. If you transfer from another ISA which includes deposits from previous tax years, that 'older money' will only earn 3.6%.

4) Increase interest earned by withdrawing £5k from chip, then deposit as 'new money' in T212.

Obviously I'm using up this year's allowance up doing this. But I've got home improvements planned later this year so will be making withdrawals for that. So with T212 being flexible ISA I'll be able to make further contributions later in the tax year to replace that if I have money spare.

Questions:
Have I missed anything or can anyone see any issues wth this plan?

masonic

That should all work. But why stick with Chip at all when there are considerably better rates available for old money?

LankyMoneySaver

https://forums.moneysavingexpert.com/discussion/comment/82066505#Comment_82066505

Thanks for the suggestion. Haven't really looked at other options yet but will check the mse guide or if you've got any suggestions?

The planned home improvements mean I'm likely to withdraw some, or all, the old money later this year. So would ideally need penalty free withdrawals, even if I have to wait the full year for any interest earned for the part of the year.

LankyMoneySaver

https://forums.moneysavingexpert.com/discussion/comment/82066648#Comment_82066648

Looks like Marsden Building Society, 4.22% is the best option for the old money given these criteria.

masonic

https://forums.moneysavingexpert.com/discussion/comment/82066653#Comment_82066653

Yes, if you want ISA flexibility that looks to be the best offer right now for old money.

LankyMoneySaver

...Although does anyone with Marsden already know if the £5000 to open can be covered with an ISA transfer instead?

https://www.themarsden.co.uk/savings/online-savings-accounts/online-flexible-cash-isa-2

The minimum opening balance must be paid by Faster Payment within 48 hours of the account opening.

Farway

https://forums.moneysavingexpert.com/discussion/comment/82066665#Comment_82066665

If you want easy & well known, Tesco instant access cash ISA. Includes 12 month Bonus, at 4.06%. Transfer in,covers opening balance, unlimited withdrawals.

Apply on line.

https://www.tescobank.com/savings/isa-accounts/instant-access/

Detail_Merchant

I went for the Monument Bank Easy Access Cash ISA Boosted Rate paying 4.34% - flexible and no withdrawal penalties - https://www.monument.co/savings/easy-access-cash-isa-boosted-rate

masonic

https://forums.moneysavingexpert.com/discussion/comment/82066926#Comment_82066926

OP can confirm, but I think there was an implication the residual money would be (or could drop) below the £10k minimum for Monument.

Also, one thing that would give me pause about Monument, is that some folk have had trouble transferring out - being told they are "not allowed" to make certain transfers. I have some personal experience of that via a family member.

Detail_Merchant

https://forums.moneysavingexpert.com/discussion/comment/82066932#Comment_82066932

Good point re the £10k minimum.
OP does also mention £15k this year contribution, but not clear if the £10k minimum would be an issue given planned home improvements.
Thanks for mentioning the minimum, I had overlooked it, as in my case it wasn't a problem.

P.S. Thanks for the warning re transfers out. I had read another thread about problems re previous tax year money vs. current tax year money and transfers out.
In my case it's all previous tax year money, so I am hoping I don't experience similar.
As it happens I have just sent an ISA transfer out request to move some money out from Monument to an existing Tesco Bank cash ISA - I will try to remember to report back to this board how this goes - good or bad.

Detail_Merchant

https://forums.moneysavingexpert.com/discussion/comment/82066936#Comment_82066936

So I posted the partial ISA transfer request (freepost paper form) to Tesco Bank just over a week ago.
Given that it was posted on the weekend I guess it wasn't collect by RM until Monday 13/7.

• On Thursday 16/7 I had an email from Monument saying "We've received a request from Tesco Bank to transfer funds from your Monument Easy Access Cash ISA to them." and "We'll confirm once the transfer is complete."
  
• On Friday 17/7 I had an email from Monument saying "We have completed the requested transfer of £ xxxx.xx from your Monument Cash ISA account ending nnnn. You can see your remaining balance in the Monument app." And the money was showing as gone from Monument, but not showing in Tesco Bank yet.
  
• Then today, 20/7, the money is now showing in my other Cash ISA in the Tesco Bank app.

So pretty quick, given that it started with a paper form in the post.
No emails from Tesco Bank, but the money is there, so that's the main thing.