ISA’s

4 05 2013

ISAIn my quest to make the most of my savings towards my house deposit I have been watching the Martin Lewis Money Show.

A recent episode has made me realise how poorly informed I am about the nature of savings (in particular ISA’s) and that my approach to savings has been as productive as an infants attempts to practice their fine motor skills by forcing square blocks into triangular holes. Since watching the show I have been in the process of moving money round all over the place to try to get the most out of the funds I have managed to raise so far.

Just over a year ago I openned an ISA account.

I knew this was considered a good option for prudent savers.

I also knew that these savings were not subject to tax.

I even knew that the tax free element has an upper limit (about £5000 when I first openned the account).

I did not know that I could continue to pay in money  after I had reached this limit.

I also did not know that if I did not remove the money from the account after the end of the tax year – that it remains tax free along with my next yearly allowance.

What a dipstick!!!!

When deciding where to put the majority of my savings I was only looking at the APR. Therefore it seemed a better option to leave my money in an account that had a higher APR rate (albeit less than 1% difference).

This decision may have cost me in the long run.

I like to think that I make good choices about how to invest my savings but I am clearly a learner in the financial world and need to pay much closer attention to the small print if I am to make the most of the savings that I have worked so hard to acculminate.

My annual tax bill has taken me back a step with my savings but at least I had savings with which to pay it rather than spending the next agonising few months paying a hefty bill and not continuing to move forward 🙂

PROGRESS TOWARDS RAISING A HOUSE DESPOSIT

DATE

% OF DEPOSIT SAVED

ESTIMATED MONTHS TILL PURCHASE

JULY 2012

28%

23 – June 2014

AUGUST 2012

31%

22 – June 2014

SEPTEMBER 2012

33%

21 – June 2014

OCTOBER 2012

36%

20 – June 2014

NOVEMBER 2012

42%

19 – June 2014

DECEMBER 2012

47%

17 – May 2014

JANUARY 2012

54%

15 – March 2014

FEBRUARY 2012

59%

14 – February 2014

MARCH 2012

62%

10 – January 2014

APRIL 2012

76%

                      6 – October 2013

MAY 2012

62%

14 – April 2014

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