Post by jamesg on Apr 5, 2016 20:31:38 GMT
Hi,
The following points got me thinking...
- Annual ISA allowance going to £20k
- New flexible ISA
- Talk of a lifetime cap for contributions.
My situation is I’m about 30 years old. I’ve been maxing my ISA for the last 10 years, but I’m going to struggle to find £20k/yr. The rumours about a lifetime cap makes me think I could hit this at some point. I can’t see that it will be taken away if you have already claimed it, but you could be restricted from taking more at some point in the future.
Is the following strategy at all sensible?...
- In March 2017 borrow £20k that allows early repayment (Ratesetter? offset mortgage?).
- Before end of FY max ISA into a flexible instant access ISA.
- April 2017 withdraw the £20k, with ability to pay back in this FY.
- pay off loan £20k loan (and 1 month interest).
- March 2018 borrow £40k for 1 month stick it an ISA
- repeat. amount + £20k each year
This does sound crazy, I see it as a way to reserve you future ISA allowance if a lifetime cap is introduced. For example I could continue to add money to an ISA in my 40’s above a cap that I couldn’t afford to save in my 30’s.
In reality I expect I would continue to invest most of the allowance so would only borrow whats needed to max out each year.
This is very dependent on a hypothetical cap and how it is implemented. e.g. flexibility could be removed.
The following points got me thinking...
- Annual ISA allowance going to £20k
- New flexible ISA
- Talk of a lifetime cap for contributions.
My situation is I’m about 30 years old. I’ve been maxing my ISA for the last 10 years, but I’m going to struggle to find £20k/yr. The rumours about a lifetime cap makes me think I could hit this at some point. I can’t see that it will be taken away if you have already claimed it, but you could be restricted from taking more at some point in the future.
Is the following strategy at all sensible?...
- In March 2017 borrow £20k that allows early repayment (Ratesetter? offset mortgage?).
- Before end of FY max ISA into a flexible instant access ISA.
- April 2017 withdraw the £20k, with ability to pay back in this FY.
- pay off loan £20k loan (and 1 month interest).
- March 2018 borrow £40k for 1 month stick it an ISA
- repeat. amount + £20k each year
This does sound crazy, I see it as a way to reserve you future ISA allowance if a lifetime cap is introduced. For example I could continue to add money to an ISA in my 40’s above a cap that I couldn’t afford to save in my 30’s.
In reality I expect I would continue to invest most of the allowance so would only borrow whats needed to max out each year.
This is very dependent on a hypothetical cap and how it is implemented. e.g. flexibility could be removed.
