The 'We're saving for a deposit' thread

Rahven

Maybe you could split it? I have an ISA and a savings account with Halifax - the money that goes into the ISA is the stuff that doesn't come out (unless dire emergency!). The savings account cash I can take out if I need to and it has no effect on allowances etc.
Of course that depends on you being able to fill up the ISA allowance before the new tax year, otherwise it won't matter. Remember you can have an ISA each so in theory you have over £10k that you can put in per year.

Suarez

quintwins wrote: »

yeah we're planning to open an isa before the new tax year anyway, but we sometimes need to take money out of our savings so my understanding is if we take it out we can't put it back in, say we put is £5340 then take out £100 before the new tax year we can't put it back in or we'd have put in £5440 so over the limit, i think anyway but thats what puts us off abit

You are correct. Why not put £4000 in an ISA and keep the £1340 in another account as backup?

(edit : Rahven beat me! )

quintwins

well really we'd only need a buffer of about £500 which would cover if something broke or we ran out of oil aswell as smaller things cause we rent so any big problems aren't our problem and our car is a company car, we don't pay servicing/mot or tax just really oil, tyres and desil (hubby works for his parents and really it's our car but in there name and we're all on there insurance and it's a people carrier so they do borrow it from time to time to deliver jobs but they always put desil in it if they do so more like borrowing our car)

i didn't relise we could both have one tho we won't save £10k this year so i think i'll go look into opening one now really we can only save £8k so really we could take a good bit out before it effected it.

prob a silly question but if we open one now do we like roll ot over to next year? i know we can only save £5k but if we save £5k do we then open a new one or just start savings on top of it in the new tax year (ok i'm rambling this makes sense in my head)

Rahven

No it's alright, I know what you mean
You can save up to £5340 per tax year (and so can your partner in a separate ISA). Generally when you open an ISA you'll get a really good rate for one year, then it'll plummet (some faster than others). Best advice is to diarise your ISA anniversary then when it comes round you can transfer what you've got to whoever is offering the best deal at the time for ISAs and accepts transfers in (assuming it's better than you'll be earning in year 2 of the original ISA as it most likely will be). So into each ISA you could save £5340 before the end of this tax year then you'll get a new allowance in April. Then when November 2012 comes round you can transfer to keep a good rate whilst still paying in towards your 2012-2013 allowance.
You can only subscribe (pay in) to one ISA per tax year but transfers are allowed within that so if you pay into one the transfer it in the same tax year you can then carry on paying into it even tho it's with a different provider.

I don't think I have explained that very well, lol! But have a look at this section of the site - http://www.moneysavingexpert.com/savings/best-cash-isa - it's ace!

quintwins

ok so if i transfer my isa at the end of the year would i then in theroy have 1 isa with £5k plus what i save into it so in theory in 2 years i'd have £10k and in 3 years £15k and so on

i did read that guide but i'm still don't 100% understand it i'm def gonna open one tho now i know we can have 2 but the best rate needs £1k to open it so it will have 2 wait til next month

Rahven

Depends what you mean by year, hehe. You've got the tax year and the ISA anniversary year

Imagine you open one today with provider X who gives 3.1% for one year. After this it drops to 1.5%. Between now and April you put £5340 into it. In April you then get another allowance so you can invest another £5340 into your ISA between April 2012 and April 2013. On your ISA anniversary, 2nd Nov 2012 you transfer your ISA to provider Y who pays 3.3% as this is better than the 1.5% your cash would be getting after 2nd Nov 2012 with provider X. At the end of the 2012-2013 tax year if you used your full allowance you'd have £10680 (plus interest). So by April 2013 you'd have £10680, by April 2014 you'd have £16020 (plus interest) etc. Remember that (if you have the money to save) your partner could have this too.

If you're going to wait until next month to open an ISA do make sure that you check the page I mentioned above for the best buy as they do change pretty often (some are pulled, new ones are released etc.). Also do check the terms and conditions - think about whether or not you will need to dip into this money at all as some accounts penalise your interest amount or rate if you make more than a certain number of withdrawals per year. Also think about what suits you best for managing the account - online, post, high street and check that the ISA you want offers this.

On a side note if you know you will not need to access the money at all until 2014 for example, you might be able to earn more by choosing a fixed rate ISA. From the MSE article: Fixed rate ISAs give a guaranteed rate for a set period, but you will face severe penalties if you try and take money out during that time.

quintwins

thanks i think i get it now hubbys so much better at understanding stuff like this than me, but he's not so good at not spending money, i really don't wanna tie my money in anywhere for more than a year we might be coming into some money soon which would mean we would be moving and then building asap it would be ok locked in for a year but no more i don't wanna be living in a mobile home for an extra year cause i can't afford a boiler or a plasterer (sp?) and have £5k sat in the bank lol

Rahven

Yeah makes sense. Go for an easy access one, no locking in required - might still be limited on withdrawals - check when you sign up

quintwins

i will do, also were getting a creditcard to help our credit rating (just a little one with a £200 limit) and as we have £360 coming in a week we shouldn't really need to spend our savings


i was just having a nosey in debt free and someone mentioned that they rounded there account down every day and paid the extra towards a debt i thought this was a fab idea and i'm def going to do it for my savings as i won't really notice it gone so i rounded both my accounts down to the nearest 10 and put £13.10 in my savings :j don't know why i didn't think to do it that way before

Beckyy

RE: credit card. What's your credit rating like now?