Benefits of bringing your ISAs together
A clear advantage of bringing your ISA investments together in one place is convenience.
Fewer pots should mean less paperwork to keep on top of. It should also mean you need to spend less time and effort managing your investments.
Convenience is not the only potential benefit of having your ISA investments under one roof. Moving might also save you money in the long run.
Some providers charge more for their investments than others, so consolidating your accounts provides the perfect opportunity to review the amount you are paying and lower your annual charges.
Transferring an ISA to M&G
As you probably know, the beauty of investing through an ISA is that any income you receive, and any capital gains from a rise in value of your investments, will be free from personal tax.
Crucially, transferring your ISA won’t affect this tax status. Nor will it use up any of your annual ISA allowance – which allows you to squirrel away up to £20,000 a year across your ISAs (excluding any Junior ISAs you may hold) – for the current tax year.
If you have an existing ISA with another provider, you can chose to transfer it to M&G. It is simpler than you might think, and you can find a step-by-step guide on our website by following this link.
Please note that while M&G will not charge for transferring your investment in, nor do we currently levy any initial charges on our funds, your current ISA provider may apply a charge when you transfer your investment out. It is worth checking this with them beforehand.
You should also note that while your investment is being transferred, your money will be out of the market for a short period of time so it will not lose or gain in value.
When you invest through an M&G ISA, you can choose from the full range of M&G funds that are available to UK investors. If you are unsure whether any fund is right for your individual needs, please seek independent financial advice.
Consolidating child savings
It is just as easy to consolidate your child’s savings into a Junior ISA, including if they have a Child Trust Fund (CTF).
Children born between 1 September 2002 and 2 January 2011 had CTFs opened on their behalf, even if parents hadn’t done so themselves, with up to £250 paid in by the government.
While there is no tax advantage to moving investments from an existing CTF account to a Junior ISA, the latter can offer both lower charges and greater choice.
To make a transfer, you will need details of the current CTF account and manager, and your child’s unique CTF reference number – this nine-character code will be on your annual CTF statement. If you have lost track of a CTF, there is a free government tool to help you trace it – link here.
From application, the transfer process should take around a month to complete. During this time, your child’s money will be out of the market, so again, it won’t gain or lose any value during this period.
Please remember that it’s only possible to transfer the full balance of a CTF to a Junior ISA. Part transfers cannot be made under government rules, nor is the process reversible – it is not permitted to convert a Junior ISA back to a CTF.
While many Junior ISA providers, including M&G, do not charge a fee to transfer the investment, bear in mind that your current CTF provider might impose exit charges if you transfer funds out.
The views expressed in this document should not be taken as a recommendation, advice or forecast.
Please keep in mind that the tax rules for ISAs and Junior ISAs may change in the future, and their tax advantages depend on your individual circumstances.
The value of investments and the income from them will fluctuate, which will cause fund prices to fall as well as rise and you may not get back the original amount you invested.