I need some advice on ISA's?

Hi I have about 9k to put away and save.

Its money I one day hope to put towards a mortgage so dont want to go putting it into something that has risk as I would rather have a house.

Would an ISA be a good idea?

Or should I put a little into some investments?

How does an ISA work and what money would I get back?

Actually any info you can give would be good as I havnt a clue.

Oh also I love you americans but would prefer English advice unless you know the UK rules etc.

thanks

There are two kinds of ISA. A full ISA you can invest 7,000 in any given financial year, but this money will be invested and exposed to the stock market. The other kind of ISA is a Mini ISA or Cash ISA and you can put in 3,000 in any financial year and is basically a savings account that you do not pay tax on. So if the interest rate advertised is 5.5% then you get 5.5% annually on your 3K. Most bank accounts advertise the rate before tax so you don't actually get that amount, you need to look at the net interest figure.

You can put 3,000 in a Mini Cash and the remaining 4,000 in a Stocks and Shares ISA.

You have to consider what your attitude to risk is, as any investment that is exposed to the Stock Market can go down so you may invest your 9K but end up with 6K if you are unlucky. Share based investments are usually long term (15 year +)

I would suggest that as you have a plan for your money and that your need for saving is actually quite short term (you will be using it toward a house in a few years) then you should put 3K in a Cash ISA right away and then you can put another 3K in on March 6 when the financial year changes over. That takes care of 6K of your money. Put the rest in the best possible interest rate bank account you can find.

The following websites will give you info on the best rates out there for both savings accounts and Cash ISAs

i would also consider putting the money into a savings account which allows withdrawals, then set up a monthly savings plan, (average first year rate around 8%) and allows you to put 拢250 per month i.e. 拢3000, then a direct debit from your saving to monthly saver will maximise your interest. Report It

http://www.nsandi.com/products/disa/inde...

You can't put 9k into an ISA.You can only put 3k per tax year into an ISA but i think that amount will rise to 拢3,600 soon.

An ISA is much the same as any other savings book account, with the exception that you don't pay tax on any interest earned. It is no risk saving - you cannot get less out than you put in, and access to your money does not require you to give notice.

The government sets a limit on the amount you can invest in an ISA in any one Income Tax Year. I believe the current figure is 拢3000. But, beware, if you were to put 拢3000 in on April 6th, and then withdrew 拢2000 on April 7th (unlikely, but possible), you would not be entitled to make any more deposits until the beginning of the next Tax Year (April 6th again). Hope that make sense.

In short, an ISA is a safe and convenient way of saving for something, with the benefit of having interest paid gross.

I wouldn't recommend any high risk investments, if you're relying on the money to put towards a mortgage, particularly since the Stock Market is very volatile at the moment.

Good luck

what is everyone on about, its 拢7000 pa.or 拢3k cash & 拢4k shares.The income is tax free and gains are free of cgt.

Hope these links will be of help.

http://www.smile.co.uk/servlet/ContentSe...

http://www.everyinvestor.co.uk/compariso...

Happy saving :)