BBC NEWS | Programmes | Working Lunch | Consuming Issues

David Hanratty of Nelson Money Managers tackles your savings and investment questions.

Mr and Mrs Willman say that the fixed management charges on their two corporate bond Isas seem high at £30 plus VAT. This amounts to 8.75% of the dividends paid. Is that high? Is it possible to switch providers of corporate bond ISAs?

Firstly an annual charge of £30 plus VAT for a single holding corporate bond Isa is a very good price.

On the maximum investment of £7,000 it works out at less than ½% for a very specialised use of the Isa allowance.

It is not impossible to switch providers of Isas containing directly held corporate bonds but it is a rare service so the choice is limited.

What should people expect to pay? Well it depends on how you use the allowance.

For shares, 0.5-1% for index tracking; 1-1.5% for active management. For bonds - around 0.75% for Bond Funds.

Looking at the annual costs as a percentage of the income is inappropriate, capital is a much more sensible measure.

John in Nottingham: "What has happened to Premium Bonds? My wife and I have the maximum holding and this last year has been terrible for returns. Is the share market having a bearing on prizes? Should we draw out and reinvest?"

Premium Bonds have cut the value of prizes as interest rates have fallen. They now pay out 2.4% of the prize fund each year.

There is a 28,500 to one chance of a £1 bond winning in each monthly draw. The maximum holding is £20,000. So someone with the full whack should, on average, win eight prizes a year. Most of these will be £50, but there is always the chance of picking up one of the bigger prizes.

Remember it is tax free so 2.4% equates to 3% gross to a basic rate tax payer and 4% gross to a higher rate tax payer - ok rates with the prospect of more, the risk of less, but no risk to capital.

David and Mary Edwards: "Can a £9,000 Toisa holding be moved to take advantage of higher rates of interest?

"We each saved £9K in separate Tessas with one of the four big banks. On maturity, the capital was withdrawn and invested in a Toisa with Abbey National who at that time were paying a more attractive rate.

"There are higher rates available - can I move the money? If so, will the original maturity certificates be returned on the closure of the account?"

Yes, subject to the notice terms and conditions of the account notice. You won't get the original maturity certificates back but you don't need them. When you switch the transferring institution certifies to the receiving institution that it is an eligible Toisa investment.

Renee Burlinson: "I have a mini cash Isa needing 30 days notice. Suppose I give 30 days notice to transfer to another provider and then find after 30 days there is a better deal somewere else?

Do I have to give 30 days in the first place? Can I change my mind at the last minute?"

The notice you give is simply to tell your current bankor building society that the Isa is going.

You don't have to tell them where to until the day it is transferred so you can wait until the notice expires and see who is offering the best rate for you and then transfer the Isa to them. So it may not be the account that motivated you to give notice.

Sara Fahey: "I have several thousand Euro in an offshore account. The interest rate is poor at 2.35%. Is there anywhere else I can put my money and get a better return? I do not want to lose out on the Euro/£ exchange rate."

I can see that you think the rate is poor but actually it's ok.

It's a bit complicated why but in essence, you are investing in the currency of another country, or in this case, countries.

That country(ies) will have its own level of interest rates and these are attached as much to the currency as they are to the country.

So if you invest in Euro - have a Euro deposit account - you get the going rate for Euro deposits in the Euro countries; if you invest in US dollars, you get rates equivalent to US depositors in the States.

You don't say exactly how much you have but I've checked and 10,000 Euros will get around 2.9% so if you have less then you're not far out.

Janet Hall: "In early November a guaranteed bond worth £16,000 with monthly interest is due to be reinvested. Where can I get the best rate of interest?

"I need the interest for living expenses (I'm a 79 year old pensioner) so I want a guaranteed bond with monthly interest. I can also invest an additional £1,000." Sadly, you probably won't get the same rate you've received on the exiting bond.

It's probably best to take a short-ish term fixed rate bond, rather like the one you had, say one or two years.

Bradford & Bingley are paying 4.07% for one year and 4.17% for two years but the rates can change every week so check again when the current bond matures.

If you're a taxpayer then you can put £3,000 of the money in a mini cash Isa so you'll get the interest tax free, the rest will be subject to income tax.

Also you could put some more into a mini Isa next year making more of the money tax free and so increasing your income.

Daniel Rawlinson: "Is there anywhere on the internet where you can compare all the different bank accounts and saving accounts at the same time?"

A load of web sites can help if you type something like 'best interest rates' into a search engine. You will get plenty of choice. Many of the sites are interactive and allow you to select balances, terms etc.

Internet, Ceefax, press also produce best rate tables. Moneyfacts have a website which also provides tables.

Mrs N Smith and David Forfar both want to know where can parents and grandparents invest money for children for the long term i.e. until they are young adults?

Depends how much risk you want to take.

The disappointing last couple of years on the stockmarket mean more people are avoiding investments with any risk.

If that's how you feel, then children's accounts at banks and building societies will pay around 4% gross which remember is well above the rate of inflation so the money would be growing.

If the money is from grandparents then the interest counts as the child's income so they can receive £4615 before they pay tax.

If the money comes from the parents then only £100 can be earned before the tax man gets involved - any more than that and the interest is taxed as the parents'. The exception is Children's Bonus Bonds from National Savings which pay 3.65% per annum for five years and are tax free.

If you are looking for a higher return and don't mind some risk then a broadly based unit or investment trust, such as Fidelity Moneybuilder or Foreign and Colonial, is worth considering.

You do need to be investing for five years though - preferably more - and designate the investment as being for the benefit of the child to make it clear for tax purposes whose money it is.

Patrick Martin: "Are National Savings worth consideratiing for standard rate taxpayers? The rates appear poor."

In the main their rates are not that hot but it's worth mentioning that most of their accounts do not have any tiering - getting higher rates for higher balances - so they can be more competitive for lower balances.

Also there are always Premium Bonds, as mentioned above, where there is the chance - however slight - of a very good return. The recent investment climate means more people are considering them.

A Cooper - "I am 2 years into a single premium 'with profits bond' at Abbey National. In that time the monthly interest has fallen from 5% to 3.37%.

"How safe are these types of bond? Is my initial investment still intact? Will it pay to cash in?"

Not as safe as the marketing people or the salesmen would have you believe!

You are invested in a fund made up of shares, bonds and cash investments. That's the main reason that the bonus - it is most definitely not interest - has fallen.

Though it may appear on the face of it that you have a relatively safe investment, cashing it in would reveal it to be the risky investment it truly is.

Insurance companies reserve the right to reduce the amount they pay out if conditions are not favourable and in July Abbey National introduced a market value reduction (MVR) of up to 20% on with profit bonds being surrendered.

This is to reflect the fact that the underlying investments have fallen dramatically in value.

So it won't pay to cash it in now. But in future if the MVR is reduced/removed and you are not happy with this level of risk you could consider it, bearing in mind also that these are amongst the worst taxed of investments for ordinary investors.

Tony Richardson - "What will the advantage be in keeping shares in an Isa when tax concession is removed next year - apart from capital gains tax (CGT)benefit?"

You mention the capital gains tax relief and for some people that is valuable - though many more people benefit from the income tax benefit on dividends.

It's true that the disappearance of the dividend tax break will render an Isa tax neutral for most people.

You then have to balance the running costs against the 'insurance policy' that the Isa provides in protecting a certain amount of money from tax.

You don't know that investment tax will not rise. For instance in 2005 the CGT allowance could be abolished and all gains would be taxable.

Also you may not pay CGT now but you may in the future if you are due to accumulate or receive more money. An inheritance or lump sum on retirement could put you on the CGT radar screen.

If you are going to hold a unit trust though, the costs are by and large the same whether you hold it inside or outside an Isa so you might as well protect the capital from future tax.

Also the tax break is not being removed on interest received so Isas will look very attractive when they are used to hold bonds or cash.

The opinions expressed are David's, not the programme's. The answers are not intended to be definitive and should be used for guidance only. Always seek professional advice for your own particular situation.