I opened an ISA about a month back (only have £110 in it at the moment)

Tax year ends on 5th April, I could afford to put £1000 in my ISA, I would be skint until the next payday at the end of April though.

Should I do it? Would I actually benefit from any interest? I think my interest rate is 2%, does that mean I'd earn £20 interest?

1 Answer 1


The main issue with saving before the deadline is that any allowance you don't use before April 5th is lost, so if you were planning to invest more in the next tax year you've potentially lost out. If you were going to save a total of £1,000 it would make almost no difference if you put it in this year's allowance or next (see below for the actual amount. If it means you might miss paying a bill or eating some meals it wouldn't be worth it.

If on the other hand you are planning to make full use of next year's allowance (a hefty £5,100 if you're over 50 or £3,600 if under) anyway then it might make sense to take advantage, but not if it means incurring other expenses.

As far as how much you'll earn in the remainder of this financial year. The 2% interest is the APR, so you would earn £20 if you invested for the whole year. Given the late stage of the current tax year you'd actually earn about 1 weeks worth of interest, or about 2% of that 2%.This works out at about 40p. You'll earn interest on that amount in future years as well though.

  • 1
    The 2010/11 ISA limit is £5,100 for everyone, not just over 50s. The difference only applied in 2009/10, when the over 50s got a higher limit as of midway through the tax year but everyone else had to wait for the upcoming tax year. Apr 14, 2010 at 7:55

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