Saving on top of a help to buy ISA
Discussion
Dear PH,
I've decided to finally grow up and start saving for a mortgage deposit.
The Help to Buy ISA sounds like a great idea but with a £200/month limit it'll take me forever to save so..
I could save faster in a regular cash ISA but miss out on the £25% government loan (a lot of places call it a "bonus" but I assume it's more like a close to 0% loan?)
I could go with a "split" ISA as far as I know only offered by Aldermore and Nationwide but I can't actually find much information on them and Aldermore's nearest branch is min. 40 minutes away plus I think they both offer only 2% while Halifax are offering 4% on a standard Help to Buy ISA.
I could go with the Halifax 4% ISA and set up an additional non-ISA savings account.
Are there any factors other than interest to consider when setting up? They all seem to have the same max starting and monthly payments.
Please advise?
p.s. I know current accounts currently offer some of the best interest rates but as far as I know you can only have one at a time and I have awful self control and will just spend anything in my current account so would rather have some self imposed feeling of financial shortage to keep my spending in check
I've decided to finally grow up and start saving for a mortgage deposit.
The Help to Buy ISA sounds like a great idea but with a £200/month limit it'll take me forever to save so..
I could save faster in a regular cash ISA but miss out on the £25% government loan (a lot of places call it a "bonus" but I assume it's more like a close to 0% loan?)
I could go with a "split" ISA as far as I know only offered by Aldermore and Nationwide but I can't actually find much information on them and Aldermore's nearest branch is min. 40 minutes away plus I think they both offer only 2% while Halifax are offering 4% on a standard Help to Buy ISA.
I could go with the Halifax 4% ISA and set up an additional non-ISA savings account.
Are there any factors other than interest to consider when setting up? They all seem to have the same max starting and monthly payments.
Please advise?
p.s. I know current accounts currently offer some of the best interest rates but as far as I know you can only have one at a time and I have awful self control and will just spend anything in my current account so would rather have some self imposed feeling of financial shortage to keep my spending in check
Edited by scarble on Saturday 12th March 09:40
I was under the impression you can only have 1 ISA of any kind at a time.
I'd assumed S&S ISAs might be out of my budget but apparently you can open one with £1 and only pay in £1/month?
Eta:
On the subject of interest rates, if at the end of the year my HtB ISA is the max £3400, at 4% I get £136 and at 2% I get £68, is it really worth all the admin to do the 4% account + another account when I could get a 2% split ISA and not worry about the pretty insignificant £68?
Or am I completely misunderstanding how interest works?
I'd assumed S&S ISAs might be out of my budget but apparently you can open one with £1 and only pay in £1/month?
Eta:
On the subject of interest rates, if at the end of the year my HtB ISA is the max £3400, at 4% I get £136 and at 2% I get £68, is it really worth all the admin to do the 4% account + another account when I could get a 2% split ISA and not worry about the pretty insignificant £68?
Or am I completely misunderstanding how interest works?
Edited by scarble on Saturday 12th March 10:32
scarble said:
I was under the impression you can only have 1 ISA of any kind at a time.
I'd assumed S&S ISAs might be out of my budget but apparently you can open one with £1 and only pay in £1/month?
Eta:
On the subject of interest rates, if at the end of the year my HtB ISA is the max £3400, at 4% I get £136 and at 2% I get £68, is it really worth all the admin to do the 4% account + another account when I could get a 2% split ISA and not worry about the pretty insignificant £68?
Or am I completely misunderstanding how interest works?
That's not trueI'd assumed S&S ISAs might be out of my budget but apparently you can open one with £1 and only pay in £1/month?
Eta:
On the subject of interest rates, if at the end of the year my HtB ISA is the max £3400, at 4% I get £136 and at 2% I get £68, is it really worth all the admin to do the 4% account + another account when I could get a 2% split ISA and not worry about the pretty insignificant £68?
Or am I completely misunderstanding how interest works?
Edited by scarble on Saturday 12th March 10:32
I have a cash and stocks and shares
Not sure about your other qu
ok that might be something to look into.. I know sfa about s&s ISAs and obviously they're risky but there we go..
seems Nationwide have never heard of this split isa anyway
eta: www.helptobuy.gov.uk says I can have a "portfolio" ISA which is a "wrapper" which can include multiple cash ISAs including a HtB, but I've yet to see portfolo ISAs mentioned anywhere.
Whew, this stuff is complicated!
etaa: seems banks are equally confused
seems Nationwide have never heard of this split isa anyway
eta: www.helptobuy.gov.uk says I can have a "portfolio" ISA which is a "wrapper" which can include multiple cash ISAs including a HtB, but I've yet to see portfolo ISAs mentioned anywhere.
Whew, this stuff is complicated!
etaa: seems banks are equally confused
Edited by scarble on Saturday 12th March 10:58
scarble said:
ok that might be something to look into.. I know sfa about s&s ISAs and obviously they're risky but there we go..
seems Nationwide have never heard of this split isa anyway
eta: www.helptobuy.gov.uk says I can have a "portfolio" ISA which is a "wrapper" which can include multiple cash ISAs including a HtB, but I've yet to see portfolo ISAs mentioned anywhere.
Whew, this stuff is complicated!
etaa: seems banks are equally confused
You might be confusing them with your terminology 'split ISA'. Just open a cash/help to buy and a stocks and shares one (assuming this is allowed in helpseems Nationwide have never heard of this split isa anyway
eta: www.helptobuy.gov.uk says I can have a "portfolio" ISA which is a "wrapper" which can include multiple cash ISAs including a HtB, but I've yet to see portfolo ISAs mentioned anywhere.
Whew, this stuff is complicated!
etaa: seems banks are equally confused
Edited by scarble on Saturday 12th March 10:58
to buy t and c's)
well apparently you can have a cash isa and a htb isa but you just have to combine them in a "portfolio isa" but trying to find any more information is proving difficult.
https://www.helptobuy.gov.uk/help-to-buy-isa/faq/ said:
I already have a cash ISA – can I open a Help to Buy: ISA too?
You can put money into a cash ISA and Help to Buy: ISA in the same tax year, but you will have to take additional steps.
If you paid into a cash ISA after 5 April 2015, to open a Help to Buy: ISA this tax year (ie before 6 April 2016), you will have to transfer your active cash ISA to a Help to Buy: ISA.
You can transfer up to £1,200 of your active cash ISA balance into your Help to Buy: ISA. Anything more than this should be moved into either a stocks and shares ISA or a non-ISA account.
Alternatively, portfolio ISAs allow you to hold multiple ISA products within a cash ISA wrapper. You can still only have one active cash ISA but it can be made up of one or more standard cash ISA products, including a Help to Buy: ISA. With a portfolio ISA, you can save into a cash ISA and a Help to Buy: ISA at the same time. The standard cash ISA and Help to Buy: ISA allowance limits will still apply.
You are able to continue to save money into a stocks and shares ISA, even if you open a Help to Buy: ISA.
- See more at: https://www.helptobuy.gov.uk/help-to-buy-isa/faq/#...
You can put money into a cash ISA and Help to Buy: ISA in the same tax year, but you will have to take additional steps.
If you paid into a cash ISA after 5 April 2015, to open a Help to Buy: ISA this tax year (ie before 6 April 2016), you will have to transfer your active cash ISA to a Help to Buy: ISA.
You can transfer up to £1,200 of your active cash ISA balance into your Help to Buy: ISA. Anything more than this should be moved into either a stocks and shares ISA or a non-ISA account.
Alternatively, portfolio ISAs allow you to hold multiple ISA products within a cash ISA wrapper. You can still only have one active cash ISA but it can be made up of one or more standard cash ISA products, including a Help to Buy: ISA. With a portfolio ISA, you can save into a cash ISA and a Help to Buy: ISA at the same time. The standard cash ISA and Help to Buy: ISA allowance limits will still apply.
You are able to continue to save money into a stocks and shares ISA, even if you open a Help to Buy: ISA.
- See more at: https://www.helptobuy.gov.uk/help-to-buy-isa/faq/#...
Edited by scarble on Saturday 12th March 12:24
scarble said:
I could save faster in a regular cash ISA but miss out on the £25% government loan (a lot of places call it a "bonus" but I assume it's more like a close to 0% loan?)
It is a bonus, not a loan. You get a voucher when you come to buy a house.Go to the bank and talk to them, there is some way of having a HTB ISA and another ISA (possibly has to be a stocks/shares ISA), but I can't remember what they said as I didn't need it.
Gassing Station | Finance | Top of Page | What's New | My Stuff