Fixed term cash ISA

[Lotobear]

I'm looking to invest an initial lump sum of 10k and then make monthly payments into a fixed term cash ISA.

Any recommendations on a good provider that is easy to open?

[mattybrown]

Virgin Money 4% you need an account with them which you can open in their app and then apply for the ISA.

Barclays had a good rate but if you are not a customer you have to phone up to book an appointment to go in branch to open one!

[Lotobear]

mattybrown said:

Virgin Money 4% you need an account with them which you can open in their app and then apply for the ISA.

Barclays had a good rate but if you are not a customer you have to phone up to book an appointment to go in branch to open one!

...yeah, hence my asking! I'm a Barclays customer - dead easy just apply online, er no sorry you can't for this product. Visit a branch? you must be kidding they've closed them all around where I live!

....and try reaching them by phone!!!

I hate Barclays with a passion but I'm locked in with business banking and personal banking - their online banking works well but their customer services is simply atrocious

[The Leaper]

A good easy to use comparison site is

https://savingschampion.co.uk/

and it has the plus of no connection to the obnoxious self-appointed savings chump (oops, sorry, champ) ML.

For this tax year's ISA wife and I have both opted for a fixed rate cash ISA both with Virgin Money, which is backed by Clydesdale Bank. All done online, simple enough. Limited paperwork from them, though, if this is a concern.

R.

[steve_n]

Do you need an ISA for this cash, most people don't...

You'll get better interest rates on normal fixed term savings accounts. As a basic rate taxpayer you get £1,000 of interest free of income tax, or £500 for a higher rate taxpayer. If your other earnings are less than £17,570 then you've also got the starting rate for savings.

[mattybrown]

steve_n said:

Do you need an ISA for this cash, most people don't...

You'll get better interest rates on normal fixed term savings accounts. As a basic rate taxpayer you get £1,000 of interest free of income tax, or £500 for a higher rate taxpayer. If your other earnings are less than £17,570 then you've also got the starting rate for savings.

Seen the not needing an ISA quoted quite a bit recently just wanted to get this straight in my head.
If you are a higher rate tax payer and have about £15K in savings rather than ISA's at 4% interest you will get about £600 interest so £100 is taxable and in the ISA it's tax free?
What do you mean by other earnings, not salary?

Edited by mattybrown on Wednesday 22 February 16:24

Edited by mattybrown on Wednesday 22 February 16:24

[supersport]

Lotobear said:

mattybrown said:

Virgin Money 4% you need an account with them which you can open in their app and then apply for the ISA.

Barclays had a good rate but if you are not a customer you have to phone up to book an appointment to go in branch to open one!

...yeah, hence my asking! I'm a Barclays customer - dead easy just apply online, er no sorry you can't for this product. Visit a branch? you must be kidding they've closed them all around where I live!

....and try reaching them by phone!!!

I hate Barclays with a passion but I'm locked in with business banking and personal banking - their online banking works well but their customer services is simply atrocious

I think Barclays got stuck in the dark ages.

If you are not currently a customer, then you have to make an appointment to physically go in :WTF:

The out of town branch can do this next week, can't open accounts though as too technical. An appointment is available at the in town branch in roughly 2030.

You really couldn't make that kind of st up.

[M3333]

I have just opened one of the 4% Virgin fixed 12 months ISA. Seems okay looking around. I'm still not beating inflation, though, but it's better than nothing. I maxed my ISA allowance in this. Would usually put it into HL and invest in equity funds, but the last 12 months have a sick feeling in my mouth. Maybe a good time to invest, though? Who knows!

[Whistle]

On this subject.

I already have an isa, can I open a new one in the next financial year with another provider so long as I don’t deposit anymore in my current isa ?

Thanks

[steve_n]

Whistle said:

I already have an isa, can I open a new one in the next financial year with another provider so long as I don’t deposit anymore in my current isa ?

You can only pay into one provider at a time each tax year but you can have a different provider for a cash ISA and a S&S ISA. So yes, assuming you have have just one type of ISA, wait until next year to add to a different provider or transfer the current year there first and then top up at the new provider.

mattybrown said:

Seen the not needing an ISA quoted quite a bit recently just wanted to get this straight in my head.
If you are a higher rate tax payer and have about £15K in savings rather than ISA's at 4% interest you will get about £600 interest so £100 is taxable and in the ISA it's tax free?
What do you mean by other earnings, not salary?

Yes. Cash ISA simply exempts all interest from income tax. Lots of people wouldn't pay income tax on their savings anyway. In your example £500 is covered by the savings allowance and £100 is subject to higher rate tax.

Other income full stop, so salary, dividends, rental income etc. If all your other income is £12,570 or less then you can have £5,000 of interest free of income tax. That savings rate band is tapered away when your other income is over £12,570 so that by £17,570 you only have the usual £1,000 basic, £500 higher or £0 additional savings allowances.