There are some significant changes that have happened with the Individual Savings Accounts (ISA) recently. The known ISAs are becoming New ISAs, or NISAs.
Every person in the UK who is 16 years old or over has an annual tax-free ISA allowance which can be held in cash, stocks and shares, or a combination. This allowance has now increased from a maximum of £11,880 to £15,000. Furthermore, the rules before said that you cannot have more than half of your ISA allowance in cash (which meant £5,940), while now you have the right to have the whole lot in cash if you want so.
What is more, the new rules expand the array of things you can do with your money. Previously it was not possible to transfer past stocks and shares ISAs into cash but you could only transfer past cash ISAs into stocks and shares. Now according to the new rules you are allowed to move your ISA money either way.
So in order to choose what to do with your ISA, you have several ways you can go. For example, if you want to save into a cash ISA, you have four options to choose from.
Easy access ISAs allow to withdraw your money whenever you want without any penalties. Usually these have different interest rates which can either go up or down. Some of them even come together with an introductory bonus that usually lasts for a year. The lowest interest rates usually go with these ISAs. If you give a sufficient notice, you can withdraw your money with a notice ISA and thus, you can get a slightly better rate. Also, there are regular saver ISAs which offer you better rather, however only for a year. There is a maximum amount you can save each month which is equivalent to a twelfth of your annual ISA allowance.
You can find the best rates offered by fixed rate ISAs. The deal with this kind of ISAs is that you lock your money away for a certain period of time and if you access it early you are going to be penalized with a loss of some or all of your interest.
When it comes to stocks and shares ISAs, you have a variety of investments to pick from, such as company shares, index tracker funds, managed funds and bonds.
Nevertheless, make sure you shop around for your ISA because there are many different platforms and stockbrokers.