MOVE OR DIE – DON’T LET THE BANKS STEAL YOUR SAVINGS
Well, OK, they won’t actually steal your savings. But they will steal the
interest if you are not careful. Each year only one person in seventeen moves
their money from one savings account to another. That means the other sixteen
are getting a rubbish interest rate. So if you put money into a cash ISA last
year because it was paying a good rate you should move it now.
But take care as there are strict rules about moving ISA money. You
cannot just take it out and put it in another. You have to get the banks to move
it direct from the old ISA to the new.
Step 1: find the new ISA. Pick one that
a) allows transfers in from other ISAs.
b) pays as high an interest rate as possible. For an instant access
account that allows transfers in that means around 3% or as close as possible.
Step 2: open the ISA. Some will allow you to open it online. Others
insist on seeing your face in a branch. Daft, but there we are. In any event you
will need your National Insurance number. And if face to face proof of address
and who you are.
If you are asked if you want to move money in from another ISA answer
‘yes’. Sometimes you are not asked and have to fill in a paper form. You can
move money in from more than one old cash ISA if you want.
When you are asked if you want to pay new money in, take care. If you put
money in then that means you cannot open another cash ISA this tax year. But a
separate new cash ISA that does not accept transfers in may offer a better rate
of interest for this year’s money. So it is best to open your transfer ISA with
zero pounds ready to move your other ISAs in.
Step 3: Make sure the transfer has happened. Sometimes there is a long
delay. It should not take more than 15 working days. Complain if it does.
Step 4: If you want to put new money into an ISA using this year’s
allowance – which is up to £5,340 – find the best rate for new cash ISAs and
open one. You can always add more during the year up to that maximum amount.
Step 5: Relax until this time next year when you should repeat the
procedure as this year’s ISA rates for both transfers in and new money will
probably be cut to next to nothing.
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