where are you putting your ISA?

cm1179 · 15 Mar 2012 at 13:10

SMN said:
Call me ignorant, but unless you have the likes of £20,000+ isnt using an ISA that can potentially limit your cashflow all for a 3% return a bit... silly? For example 3% interest on £30000 is £900 by my maths, but if you have to run the risk isnt it a very low risk/reward ratio?

it's not silly, one can always get their money out, there's a penalty though.

personally, my ISA is money i can get by without. if i was treading a thin line, i wouldn't be in the position to save. i am and i am grateful for this but that's because i'm careful with my money, hence why i'm asking about an ISA and not who to bet on in tomorrows gold cup

Heliospherez · 15 Mar 2012 at 13:12

SMN said:
Call me ignorant, but unless you have the likes of £20,000+ isnt using an ISA that can potentially limit your cashflow all for a 3% return a bit... silly? For example 3% interest on £30000 is £900 by my maths, but if you have to run the risk isnt it a very low risk/reward ratio?

OK, Ignorant

There is no risk. The return is guarenteed - and for people not willing to take "a risk" - it is currently the best way of saving in a Bank / Building Society where you can get at your money easily. I fail to see how you assume it's a risk....

cm1179 · 15 Mar 2012 at 13:13

Ahleckz said:
I appreciate that ISAs are useful if you are looking for tax free savings, but if you aren't worried about tax (as in, your income is too low) are there better places to put a lump sum in for saving? Or is it best to just keep putting the maximum into an ISA each year?

I'm terribly ignorant about savings, but need to fix that.

look into bonds your bank offers or see the stocks and shares thread.

bonds are a safer bet and only invest in stocks and shares after taking advice, understanding as best you can and realising what they're about - taking the rough with the smooth and often long term.

xaldub · 15 Mar 2012 at 13:13

Ahleckz said:
I appreciate that ISAs are useful if you are looking for tax free savings, but if you aren't worried about tax (as in, your income is too low) are there better places to put a lump sum in for saving? Or is it best to just keep putting the maximum into an ISA each year?

I'm terribly ignorant about savings, but need to fix that.

If you don't have that much in savings, and there is a strong likelihood that you may need to dip into your savings to make ends meet then a Cash ISA is probably your best bet.

jamief · 15 Mar 2012 at 13:14

I've put my S&S allowance into a Lloyds Corporate Bond, 7.58% and currently trading at .86

cm1179 · 15 Mar 2012 at 13:16

jamief said:
I've put my S&S allowance into a Lloyds Corporate Bond, 7.58% and currently trading at .86

how long have you had to leave it in for?

jamief · 15 Mar 2012 at 13:18

cm1179 said:
how long have you had to leave it in for?

I haven't - its traded like an equity (i.e. on the open market), so you simply buy units (minimum purchase is 1000 units, plus you pay accrued interest). You can sell whenever. Reason its trading at .86 is because the coupon has only recently been reinstated.

ubersonic · 15 Mar 2012 at 13:27

My ISA's? In the bin, no point in keeping them, most PCI cards go in the bin too these days too.

cm1179 · 15 Mar 2012 at 13:29

jamief said:
I haven't - its traded like an equity (i.e. on the open market), so you simply buy units (minimum purchase is 1000 units, plus you pay accrued interest). You can sell whenever. Reason its trading at .86 is because the coupon has only recently been reinstated.

i'm a novice at this kind of thing.

any chance you could give me and others a kind of 'idiots guide to...'?

jamief · 15 Mar 2012 at 13:37

cm1179 said:
i'm a novice at this kind of thing.

any chance you could give me and others a kind of 'idiots guide to...'?

Sure.

LB1G is a Corporate Bond which is listed on LSE (called a listed bond in certain circles). Basically, Lloyds want to raise £XXm. They issue a bond for this amount, split into units. Each unit is valued at £1, and for every unit they will pay interest (in this case 7.5884% per year.

In the case of LB1G, Lloyds (for whatever reason) "suspended the coupon" i.e. didn't pay interest for several years. This made the bond unattractive to investors, so the price per unit dropped to ~£0.70 at one point.

Lloyds then reintroduced the coupon last year (i.e. started paying interest again) at which point the price began to rise.

In essence, you buy XX units of the bond. Each year you earn interest at 7.5884% on your holding (it is paid in 2 installments). When the bond matures (in 2020), you will get £1 back for every unit you hold. I bought a load of units at <£1, so I'll make money via the coupon each year AND by getting back more than I paid when it matures.

The risk is that the coupon may be suspended again (although this is quite unlikely).

cm1179 · 15 Mar 2012 at 13:40

very interesting. thankyou, moses and jamief.

TwsT · 15 Mar 2012 at 13:42

a barclays golden isa or something, don't use it anywhere near enough!

SHEDDER1uk · 15 Mar 2012 at 14:05

I use the Santander isa and savings account.

drone · 15 Mar 2012 at 14:08

In my pocket

djkav · 15 Mar 2012 at 14:14

I have £25k in a Natwest e-isa @ 3.25%

I got my next years £5,640 all waiting for April 6th

I don't see the point in being locked in for 2+ years. If the UK gets a credit downgrading, that might put pressure on interest rates here.

TaKeN · 15 Mar 2012 at 14:20

Building Candy said:
Cheeky they say "transfers in for deposits up to £29,999" hmm.... looks like its nationwide at 3.1% then.

Where does it say that!?

I think you're reading wrong

Building Candy · 15 Mar 2012 at 14:31

TaKeN said:
Where does it say that!?

I think you're reading wrong

lol, after going through the Santander site it says nothing about it! only on the:

http://www.moneysupermarket.com/savings/cash-isas/

it says "Market leading for transfers in for deposits up to £29,999" no idea where they got that from!

TaKeN · 15 Mar 2012 at 14:48

UP TO £29,999.

In other words, they're saying if you have £30,000 you're better off sticking it in the Natwest e-Isa

Just sending off my Santander Proof of I.D Now, bloody pain in the bum

, all because my address on the electoral roll isn't quite right.

Building Candy · 15 Mar 2012 at 15:51

riiiiiiiiiiiiiiiiiiight I understand now, its their helpful info, I thought it was a condition of the isa!

Lead_Head · 15 Mar 2012 at 16:12

M&S..