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New Tax Year, New ISA?

I was chatting with a friend just this morning about how and when to make changes to his Cash ISA (Individual Savings Account). He’s been pretty fed up with the rates he’s getting from his current bank but wasn’t sure what the best move would be.

First things first… find a bank with a better ISA rate. Do a little research to see who is offering what. Make sure you read the fine print on length of term, penalties for early terminations ability for top-ups and general customer service provided by the financial institution. You also need to check if the new preferred ISA manager accepts transfers in.  This is so that you don’t get penalised on your current ISA by “withdrawing” rather than transferring the funds over.

Once you’ve made your choice of new cash ISA manager, ask them to initiate the transfer from your existing cash ISA. What’s the bad news I hear you ask? It can take up to a month for the transfer to take effect. Given this day and age of modern technology and fast payments between banks, it isn’t up to standards that you would expect. Once the money is transferred though, your new cash ISA can start earning you some well deserved interest.

Another question my friend asked me was whether or not he could open two cash ISAs in the same tax year. The answer is technically no. You can hold more than one cash ISA but you can’t open more than one per tax year. You can however, transfer the cash ISA from one bank to another AND open a new cash ISA as this is not technically opening a second cash ISA in the same year.

If you’re not sure what to do with your cash ISA or are looking at other ways of investing, speak to one of our advisors who can assist you in working out the best solution for your needs.


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