There are several reasons why people want to transfer their Individual Savings Account. One of the most common reasons is to transfer to a better performing account. With a low base rate, a lot of people find that their ISA has dropped below what it was when they made the account. That’s why they choose to make an ISA transfer that has the best interest rate. When your current ISA’s rate doesn’t match up to the best interest rates on the market, then it is time to make the switch.
Most people think that an ISA transfer is a tedious task. On the contrary, it is much easier than they think. It is important to remember that you should not just withdraw all the money from an ISA, or else you will lose all the benefits.
In order to facilitate the ISA transfer when you already have a new ISA account, you need to ask your old ISA provider for a form and give them your new account information. This process is needed so that the bank doesn’t treat it as an account closure but instead as an ISA transfer.
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Another way to make an ISA transfer is to ask the new provider if they can do the transfer for you. Just keep in mind that not all new ISA account providers will allow a transfer of an existing account. More often than not, the best rates are for ISA accounts that you can’t transfer to. So be sure to check this out before opening an account.
According to the Office of Fair Trading, transfer times for ISA cash accounts must not take more than 15 days. For stocks and shares ISA, the deadline is 30 working days. This is an improvement from the old system where the clients have to wait for their money to be transferred for up to two months. The OFT also made banks continue paying the interest during the transfer period.
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You are allowed to transfer cash ISA to cash ISA with another provider. This can also be done with shares and stocks ISAs. All the money that has been invested in an ISA for the present year must be transformed to the new account. For the previous years, you have the choice to transfer part or all of the savings. It is important that check with the provider for any restrictions they have on ISA transfers. Some providers may charge you for the transfer.
It is important to compare various savings accounts before starting the ISA transfer process. You should compare various factors that include minimum investment and interest rates. That way you will be able to find the rates on the market today.
ISA Transfer is not regulated and doesn’t give investment advice and is not regulated by the FCA. Value of investments can go up and down and if you are not sure you should consult the advice of a regulated professional
* ISA’s tax free status subject to HMRC rules that could change