From: adam_111_a@yahoo.co.uk (Adam)
Newsgroups: uk.finance
Subject: Holding maxi ISAs / PEPs as cash / low risk investments
Date: 9 Nov 2003 15:01:23 -0800

Hi folks,

I have invested a substantial part of my life savings in maxi ISAs and
PEPs and these are currently predominantly held as cash. (Most were
liquidated around 2001). I will invest gradually in shares/stocks as
the market becomes less volatile but do want to hold them some more
time as cash before I do so.

Before I switched, my previous ISA/PEP provider was hassling me that I
shouldnt hold them as cash for a long time. My current provider hasnt
done this so far.

Would appreciate some guidance on the following:

1. What is the maximum period the taxman permits holding maxi ISAs and
PEPs as cash ?

2. What are maxi ISA/PEP approved investments closest to 'cash '( i.e.
least riskest investments) which would avoid the risk that the ISA/PEP
would be voided by the taxman. I am looking for something which is
fairly liquid and which carries a low charge to invest / dis-invest.

I appreciate that with low risk investments my returns would be low. I
would be happy if I earn around the base rate (rather than the current
low rate on cash balances, see below, which is also subject to 20%
tax).
Any idea how I can achieve this ?

3. My current provider pay a measly interest on cash balances (0.1%
for balances less than 15K and 1.75% above 15K) Any suggestions for an
online ISA/PEP provider who pays a more generous rate ?

Cheers, Adam