Happy new Isa year
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Other Isas offering top rates that have an introductory bonus include Alliance & Leicester’s Direct Isa (Issue 4), which gives 6.25% interest until the end of May 2009, when the rate will drop by 1%.
While an introductory bonus helps boost your tax-free interest for the nominated period, if you don’t want to transfer your Isa every year you should consider consistency over headline rates.
Yorkshire Bank’s e-Isa, paying 5.55%, has been the most consistent over the past 36 months, according to Moneyfacts.
Some of the top cash Isa deals still on offer don’t have an introductory bonus, such as Scarborough’s Notice Isa, which offers 6.3% interest on a minimum outlay of £1,000. There is also a 30-day notice period.
Dunfermline’s Guaranteed 30 Cash Isa also has a 30-day notice period and pays less at 6.25%. However, you can open the account with just £1.
For greater simplicity, National Counties’ Guaranteed Cash Isa will give you 6.26% interest, with no bonus period, instant access and a minimum deposit of £1.
Earn more interest
Transfer window
It’s possible to transfer from another Isa account into some of these top deals already mentioned, making management of your tax-free savings all the easier.
Alliance & Leicester, Scarborough and Dunfermline each allow transfers into their Isa products. You can transfer into the National Counties Isa a year after it has been opened.
If you transfer your Isa from one bank or building society to another, it’s important that you don’t immediately close your old account: if you do, you’ll lose your tax-free benefit on that particular amount.
Instead, wait until you get a transfer form for your new provider which you complete with the details of your previous Isa to finalise the switch.
Don’t forget that your yearly Isa allowance is now £3,600 for a cash Isa or up to £7,200 for a stocks and shares Isa (which can include up to £3,600 in a cash component).
Of course, the more money you can put into these tax-free accounts, the more tax-free interest you’ll earn over the coming year.
