Fixed Savings Icesave questions

cundall

Hi,

I had £35K in Icesave though i transfered out £3.6k for this years isa.... I don't need access to my savings for the next year and i was looking at Icesave's fixed rate savings... I know it is not as good as other providers though as my money is already with Icesave it's easy to transfer within the same bank so i will stay with them...

My question is... I would get a higher rate for 6 month term though do you think (i know no one will know the answer as we would all be millionaires if we did) it's better for a 1 year term or 6 months?

Secondly if i select monthly interest am i able to withdraw the interest without any fees?

Lastly can i add to the plan once it has started? As i am planning on topping it back to £35k before using another account.

Thanks in advance... I know the questions may be stupid though i just want some clarification before i make the transfer...

sloughflint

http://www.icesave.co.uk/fixed-rate-savings-questions.html
and

• Interest rate fixed for the term of the account
• Choose when you receive your interest
• Save from just £1,000
• No withdrawals or additional deposits can be made during the term

cundall

Thanks sloughflint - just one question still remains... do you think its better to go for the lower 1 year fixed rate or the higher 6 month deal? (should not need access to the money for 1 year)

earlgrey_3

cundall wrote: »

Thanks sloughflint - just one question still remains... do you think its better to go for the lower 1 year fixed rate or the higher 6 month deal? (should not need access to the money for 1 year)

The guess you need to make is whether the banks are so desperate for our loot that the rates are as good as they'll get - currently well over base rate - or whether rising inflation will cause the base rate to rise again and push savings rates still higher. Or whether the banks will be even more desperate in a couple of month's time.

As you say, no-one knows, including the banks. The 6 month rates are generally a smidgeon higher than 12 month rates which suggests that some banks think rates will fall. You could always hedge your bet and split between the two.

I tend to get fidgety if I can't get to my loot but have put two lots away in 12 month fixed rates. This time next year I'll know whether to congratulate myself on my shrewdness or kick myself for getting it wrong.

If you're over 50 the best of all bets has to be the Coventry which is paying 6.4% fixed, not just a relative "guarantee", but still allows instant no penalty withdrawals and additions. http://www.coventrybuildingsociety.co.uk. Closes at midnight tonight.

Primrose

Guess Earl Grey is on the right track. I've opted to transfer a chunk of Icesave funds to the One Year fixed rate, and a smaller proportion to the Two Year rate. None of us are going to get it right all the time so it's all about not putting all our eggs in one basket. Haven't read the Frequently Asked Questions, but if at a later date you want to put further money aside, you can always open another bond if existing bonds won't accept additional deposits (if the interest rate suits, of course).

cundall

thanks for all your help...

I am not over 50 (only 25) but i think i am going to go against all your advise and put 95% of my money in one basket for one year as i am young. No matter which open i select it will be the wrong one!

So i am putting £30k in to a 1 year fixed rate savings account with Icesave then i will keep my current account with them and top that up so it reaches £35k combined. Once i reach £35K then i will start a new savings account with another provider...

Thanks again for all your help...

earlgrey_3

There's something to be said for putting all your eggs in one basket too. Andrew Carnegie said it was the quickest way to become rich. Put your eggs in two baskets and 50% of them will be in the wrong one.

Primrose

Cundall is obviously disproving the theory that all wisdom must necessarily come with age. Still sounds like a sensible choice to me.

earlgrey_3

Primrose wrote: »

Cundall is obviously disproving the theory that all wisdom must necessarily come with age.

I disproved that theory long ago. Hasn't come to me yet and now I'm getting very impatient.

cundall

Thanks both of you and i will leave you to debate if wisdom comes with age or not

I have now made the leap and setup a 12 month fixed rate account which should be fully active in the next few days and arranged to transfer £30k over once it is setup. I think its the best way as i am still young and planning to move abroad and by locking the money away i cannot spend this

A couple of weeks ago i transfered all my ISA's to LLoyds at the 6.55% rate as before i was not monitoring my finances and did not know you could transfer old ISA's to a higher rate. I am now getting back on track (saving) though last months credit card bill did not help me :mad:

Primrose

Presume you will be planning to withdraw all your money when you move abroad? Am not sure if you can hold ISAs once you're resident abroad but no doubt somebody who knows for sure will be able to confirm this.