I have held my ISA with Bradford and Bingley now since the start of the last tax year when I used my annual £3,000 cash allowance to open a new account and also to transfer my existing ISA balance across from my previous provider Abbey National. My reasons for doing this were twofold, rate was the first motivator as the rate offered by B&B had been consistently above that of Abbey and whilst best buy tables are very fickle the B&B account had featured over a number of months and secondly I wanted the convenience of operating the account online a feature that whilst it was available with Abbey my experience of their online account operation had not been a positive one while I had an existing e-saver account with the B&B which had been easy to operate and overall quite efficient.
What is an ISA?
Before detailing my experience and this particular product it is useful to explain exactly what and ISA is. ISA stands for Individual Savings Account and is basically a savings account that allows savers to get a completely tax free return on their money irrespective of their personal tax liability., any return on the money invested is free from both income tax and capital gains tax. Therefore this type of account has clear benefits to both higher rate and basic rate tax payers and even for non tax payers the fact that the account attracts normally high rates for a reasonable level of investment makes it an attractive option.
There are a number of ISA options available to people and it can at first seem confusing. In basic terms you have to be 18 or over to open an account and you can only open one account in any tax year. The account can only be in your sole name. The maximum that can be invested into a saving based account is £3,000 in any tax year however in total you can invest £7,000 in a tax year but the remainder must be invested in a stocks and shares based investment fund or for those willing to take more of a risk the whole £7,000 can be invested in stocks and shares. Like I said there are a number of options and it is recommended that financial advice is sought before investing.
For those who opt solely for the cash ISA option there is instant access to your money and usually accounts offer an ATM card with them to allow withdrawals or in the case of an internet based account money can be transferred into a cheque account.
The Bradford and Bingley Account
The B&B ISA is a cash mini ISA therefore the maximum opening balance is £3,000 whilst the minimum opening balance is £1,000. Currently the interest rate is 5.15% however it is important to note that this rate is variable so it will be subject to change however this rate is quite competitive compared with other accounts on the market.
The account I opened is an internet based account and these usually attract a slightly higher rate than those operated via the branch network and this higher rate reflects the lower operating costs that the bank incurs on the account.
Opening the account was easy, the website is well set out with links to all of the accounts and well written operating instructions and key features documents which summarise the account benefits and also the conditions that apply.
Initially opening the account involves completing a brief application form online, the main bit of information you will need is your national insurance number as you cannot open an ISA without one. Once your details have been submitted and the account details checked you will receive an e-mail detailing your user i.d. reference which is a random mixture of numbers and letters. Through the post you will receive a password and the first time that you log onto the account you will be prompted to change this to a password of your choosing. As with all online passwords this should be something not easily obtained by fraudsters and it is recommended that a combination of letters and numbers is used.
Within about a week I had received all of the paperwork including a printed application form for checking and you will need to send a cheque for at least a £1,000 to open the account. I preferred to do it this way and then transfer electronically the remaining £2,000 from my bank account to brig my balance up to the maximum £3,000 allowed.
One of the things that I really liked about the account was that once it was opened transferring the balance from my current ISA into which I had invested previous years balances was very easy, all I had to do was fill in a couple of bits of information such as my Abbey account number and B&B handled the transfer for me, arranging for the closure of my old account and the funds being added to my new account. This whole process can take up to 28 days as some institutions are not always quick to release funds however in my case it was completed within twelve days which I was quite happy about.
The website through which the account operates is naturally a secure site and the bank has a policy of never sending e-mails regarding your password or to confirm any account details. The only slight security concern I have is that when logging on you have to input the entire password each time rather than having to enter randomly selected letters from the password as the general view is that this method is slightly more secure in case any key monitoring spyware has been inserted onto your PC.
Have found the service with the ISA to be pretty good and any account questions I have asked by e-mail have been answered within 72 hour of them being submitted. It is possible to phone B&B direct if you have any queries and whilst the phone lines are only available during normal banking office hours rather than 24 hours I have found on the one occasion I have had to use the phone the service was efficient and polite.
Transferring money in or out of the account is easy however you do have to allow a few days for the transaction to be processed via a direct debit facility although once you have input the instruction is does appear as a pending transaction just to remind you that it is being processed until it has completed. You can view your balance 24 hours a day online and interest is added in March of each year.
In summary whilst the B&B ISA is not the best online account I have experienced it is a very solid account, easy to operate and paying a consistently high rate of interest, it is simple to understand and with the online account you are not bombarded with lots of e-mail trying to cross sell you good, have only ever received a couple of e-mails advertising new product launches.
I would definitely recommend it as being an account to consider.
Thanks for reading and rating my review.