Cash ISAs: The Best Currently Available List
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Hello all,
I hope somebody can offer me some advice on the best action to take regarding my ISA situation. I currently have £1000 in an A&L ISA, with a rate of 5.7% (including a 0.7% bonus till the end of April), and am looking for the best place to move the money to when this rate drops.
I've been considering the top rated ISAs that allow transfers in such as YBS and Abbey, but should I also think about drip-feeding into an HSBC Regular Saver Account (£250 per month maximum for 4 months; fixed at 8% gross/6.4% net) as I already hold a current account with them? Not really sure which route would provide the better interest over the year. Any major advantages/disadvantages of saving in a Regular Saver account instead of an ISA, besides the £250 maximum monthly payment?
Thanks for your help.0 -
groverjoe - You haven't added your tax status to your post, which is really important when comparing an ISA to an account which is taxed - unless the customer registers for gross interest.
Assuming you're a basic rate tax payer, who is comparing paying in £250 pm into the HSBC regular saver to YBS' 5.65% ISA:
HSBC's regular saver would make approx. £104 interest while the YBS ISA would make £91 interest. However, this only illustrates the approximate return you would get over the short term.
The best thing about mini cash ISA's are that they are tax-free i.e. you get to keep all of the interest that they accrue over the years. The long term gain from an ISA definitely outways the short term gain of regular savings accounts in my opinion.
I have many regular savings accounts, some of which are paying 12% or more. However, I always use my ISA allowance first and then put any surplus funds into regular savers and then easy access accounts. The HSBC regular saver sweeps the funds into a lower interest paying account after just one year, you can start a new one, but the balance starts from '£0.00' again. Whereas the ISA allows you to build up a large lump sum over the years earning tax-free interest on your interest as well as your capital.Please call me 'Kazza'.1 -
Kazaa - thanks for the very clear explanation which has made things so much simpler! I'm going to follow your advice and take the ISA route initially to benefit from the long term gain (I'm a basic rate tax payer, so the short term interest gain from the regular saver would be minimal).
Can the £1000 lump sum be transferred in to a new provider at any time (YBS/Abbey), and for the maximum benefit, would you recommend adding 07/08 contributions to the lump sum or to another new ISA provider with a higher rate (such as Barclays at 6.5%). Is this allowed within the ISA rules?
Thanks again.0 -
Can the £1000 lump sum be transferred in to a new provider at any time (YBS/Abbey)
Yes, the £1,000 you currently have with A&L can be transferred* to another provider at any time. If you have more money available to deposit before April 6th, why not top up this isa? Also, if you have less than £9K YBS offers a better isa rate at 5.65% to Abbey's 5.50%. [*Allow the providers to handle the transfer for you, don't try to transfer it yourself]....for the maximum benefit, would you recommend adding 07/08 contributions to the lump sum or to another new ISA provider with a higher rate (such as Barclays at 6.5%). Is this allowed within the ISA rules?
It is allowed under ISA rules. From April 6th every year we all get a new ISA allowance, which you can deposit with your existing isa savings provider or open an isa with a different provider.
On your question of whether it is better to keep your existing and new isa savings (07-08) together, it is up to you. In the past I've tended to keep mine together, because the rates on offer for 'new money' isa's at the time wasn't much better than the rate I was receiving on my existing isa savings. However, this year this is no longer the case with Barclays' 6.50% offering being 0.85% more than YBS' rate for example. I am transferring my existing isa(s) to another provider and then opening a new money isa elsewhere.Please call me 'Kazza'.0 -
Superb work Kazza. :T
For those looking for a longer term perhaps this 4 year deal:- Halifax Fixed Rate ISA Saver - 6.00%
Minimum deposit: £3,000. Max £33,000. Transfers in requests accepted. Earlier access on closure only on 30 day notice + 180 day loss of interest.
Just locked in all my ISAs into the halifax 4 yr deal as I expect interest rates to come down staring 3rd or fourth quarter of this year with 5.25 being the topmost interest rate.
Also over 2 yrs if interest rates come down to 4-4.25% then 6% :T tax free look gr8
The only hitch being the 180 days interest cost for early withdrawal and part withdrawal not allowed. So i did 2 fixed rate ISAs (65% & 35% of total amounts) so that if i did need access I can break only one of them:beer::beer::beer:0 - Halifax Fixed Rate ISA Saver - 6.00%
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Thank you Kazza for the very useful list of ISAs. I too have spent today searching for the best place to put some money from a house sale that went through last week and the cheque cleared today.
I have been looking at the Abbey 8.1% ISA that is linked into a Growth Plan - has anybody else looked at this?
I also need to invest my cash ISA limit for this year, followed swiftly by next years, and am wavering between the NS&I and Barclays - any suggestions?
Fully intend utilising the NS&I 3 or 5 year accounts to maximise tax free investments. Does anyone know if you can invest the maximum £15,000 each year, or once it has £15,000 in the account is that it?0 -
Hi there,
My current ISA is with A&L and I am looking for the best new home to transfer it to - please can anyone advise? I've been reading on here about Ruffler but feel a bit uncomfortable with them as I hadn't heard of them before. I think the next best paying one might be the Abbey ISA which seems to be paying 5.75% on balances of £9k plus and seems to allow transfers in - does anyone have any thoughts on this or other suggestions?
Also, am I too late to arrange transfers to another provider - I'm not sure what's involved.
I've decided that for the next ISA year I will probably go with the Barclays ISA as that seems to be paying the best rate at the moment.
Thanks in advance.
Regards,0 -
Thank you Kazza for the very useful list of ISAs.
I'm glad it's been of help. It has certainly helped me to make up my mind.Pusser wrote:I have been looking at the Abbey 8.1% ISA that is linked into a Growth Plan - has anybody else looked at this?
I'm not keen on this ISA at all, because the 8.1% rate only lasts until May 2008 and then reverts to just 5.25% (for balances of £9K+) or 5.00% (balances under £9K). You have to put an equal sum of money into Growth Plan which is then tied up for 3 years. The growth plan is seen as a rather poor product.Pusser wrote:I also need to invest my cash ISA limit for this year, followed swiftly by next years, and am wavering between the NS&I and Barclays - any suggestions?
They are both very good ISAs. NS&I guarantee to pay BOE base rate + 0.55% until 5th April 2008. Barclays' offering pays 5.50% + a 1.00% bonus. The bonus expires one year after opening the account. As both guarantee and bonus expire in a year, you would have to transfer out of both ISA's sometime next spring. I think the Barclays' 6.50% is too good a deal to miss out on, especially as you haven't used this years ISA allowance yet.Pusser wrote:Fully intend utilising the NS&I 3 or 5 year accounts to maximise tax free investments. Does anyone know if you can invest the maximum £15,000 each year, or once it has £15,000 in the account is that it?
The maximum is £15,000 per issue not per year.Please call me 'Kazza'.0 -
travel_freak wrote: »I've been reading on here about Ruffler but feel a bit uncomfortable with them as I hadn't heard of them before.
They aren't particularly well known. Some MSE members have transferred their ISAs to them, but like you, others have decided against transferring to them because they've never heard of them. Like all banks, they are a member of the FSA compensation scheme which is the most important thing.travel_freak wrote:I think the next best paying one might be the Abbey ISA which seems to be paying 5.75% on balances of £9k plus and seems to allow transfers in - does anyone have any thoughts on this or other suggestions?
This ISA currently offers a good rate for those with balances of £9K+, but the rate includes a 0.50% which expires in May 2008. The rate then reverts to 5.25% (or 5.00% for balances under £9K). I think this ISA is good choice provided you a) have the £9K or more to deposit and b) are prepared to tranfer out around May 2008. Others to possibly consider are Kent Reliance at 5.71% (they have maintained a good rate for two years) and YBS 5.65%.travel_freak wrote:Also, am I too late to arrange transfers to another provider - I'm not sure what's involved.
It is never too late to arrange an ISA transfer. As you are currently in a non-fixed term ISA, you can initiate a transfer at any time during the year. Check out this thread for more info on transferring: http://forums.moneysavingexpert.com/showthread.html?p=3921669&highlight=steps#post3921669travel_freak wrote:I've decided that for the next ISA year I will probably go with the Barclays ISA as that seems to be paying the best rate at the moment.
For 'new money' ISAs Barclays is probably now the best choice.Please call me 'Kazza'.0 -
I want to open up a Barclays Tax Beater ISA but would be a new customer. I have to take a passport into a branch but the nearest branch for me is 350 miles away. Does anyone know if I can go to a Woolwich BS to have the verification done there. Barclays help line told me I could, Woolwich told me I couldn't.....Can someone help?
Cheers
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