Almost 30% to shun savings of cash ISA allowance

POSTED: 5th March 2013
IN: Personal News

Almost 30 per cent of people with a cash ISA will fail to take full advantage of its tax allowance, with the tax-year drawing to a close on April 5th.

undefinedThe findings from indicate as many as 28 per cent of savers with a cash ISA do not plan to use their full allowance for 2012-13.

Analysis from the organisation shows that those who have invested in a cash ISA since its launch in April 1999 could have stored up a savings pot of as much as £18,592 in interest.

That is £4,383 more than those who have put their spare cash into an easy access savings account over the same time frame.

The cash ISA allowance for this year stands at £5,640, with that figure set to rise to £5,760 in the new tax year, giving savers the opportunity to invest even more in a pot.

Head of banking at Kevin Mountford says: “Even if you have never saved into an ISA before, it is never too late and with only a month until the tax year ends on 5th April, it's a case of use it or lose it when it comes to your ISA allowance.

“ISAs should be a number one consideration for UK taxpayers who want to make the most of the tax free benefits on offer. “

Some 39 per cent of people have or plan to save into a cash ISA this year, the research found, with Mr Mountford advising those with savings in other accounts to transfer them into an ISA.

He added: “Over time, a cash ISA can give a decent return with no risk.”

So for those in search of a medium-term savings solution, the tax free benefits of a cash ISA could be just the option as it helps to ensure there is enough put aside for significant financial goals.

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