ISA’s at Halifax Bank of Scotland

ISA’s at Halifax Bank of Scotland March 8

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There are three types of ISA’s available from the Halifax Bank of Scotland (HBOS): mini cash ISA’s; mini stocks and shares ISA’s; and maxi ISA’s. It is possible to invest up to £3,000 in cash in a mini cash ISA in each tax year, £4,000 in a mini stocks and shares ISA, and £7,000 in a maxi ISA. It is also possible to invest cash in a maxi ISA, but only up to £3,000, with the remainder of the £7,000 open to investment in stocks and shares.

There are a number of portfolios available to stocks and shares ISA investors, and all are Open-Ended Investment Company funds - a type of collective investment. Each portfolio is ranked in terms of perceived risk to the investor. Meanwhile, there are three different mini cash ISA variations. A brief summary of the portfolios and accounts available is provided below.

Portfolios for mini stocks and shares and maxi ISA’s investment

Cautious/medium portfolio

A fund for cautious to medium investors, the cautious/medium portfolio reported a return of 6.2 per cent last year. Money is invested in stocks and shares that offer some security with the potential for long term growth or income. However, it should be noted that the value of investment could go up as well as down - and this in fact applies to all stocks and shares portfolios.

Medium

The medium risk portfolio is made up of a balance of investments that offers a wide spread of UK investments with potential for long-term growth or income. Last year the medium fund made a return of 10.5 per cent.

Medium/adventurous

Moving into more risky territory now with the medium-adventurous fund: it actually only reported growth of 9.2 per cent last year - lower than the medium portfolio - but grew by 18 per cent the year before. Investors buy into a balance of investments including international as well as UK equities.

Adventurous

The most risky of all: the adventurous reported growth of 18.5 per cent in 2004/5, but only 9.4 per cent last year - while the possibility remains that investment will decrease in value. In an attempt to secure high returns, investments are made in specialist areas.

It is also possible to invest in a fund that aims to match as closely as possible the performance of the FTSE 100 Index, which is made up of the top 100 companies listed on the London Stock Exchange. This is available through the FTSE 100 Index tracking fund.

HBOS cash mini ISA’s

Fixed rate Halifax ISA saver

Assorted rates are available for cash invested in the fixed rate Halifax ISA saver, depending on the length of time the investor is willing to keep money in the account. One, two, three and four year terms are available, with the four year sentence currently offering a fixed interest rate of 5.65 per cent AER. No additional deposits or withdrawals can be made to the original investment (maximum £3,000).

Halifax ISA saver direct

Up to £3,000 can be invested in each tax year, with a minimum investment of £1 required, and withdrawals can be made without prior notice. A variable rate of interest is offered, which currently stands at 5.3 per cent AER. The account can be managed by phone or online.

Variable Rate Halifax ISA Saver

Again, up to £3,000 can be invested in each tax year, with a minimum investment of £1 required, and withdrawals can be made without prior notice. The variable rate Halifax ISA is a passbook account with branch access and tiered, variable interest rates, which currently stand at 4 per cent AER/gross pa for £3,000. Transactions can be viewed online.

Written Exclusively by AdFero for ISA Guides

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