View more on these topics

Stocks and shares Isas overtake cash

UKCoinsCurrencyPoundsFalling480wThe amount invested in cash Isas has collapsed as stocks and share accounts have overtaken them for the first time.

Data from HM Revenue and Customs shows that the number of cash Isas opened dropped by 1.6 million in 2016/17, falling to 8.5 million. The amount invested fell by nearly £20bn, dropping to £39.2bn.

Stocks and shares Isa subscriptions were up £1.2bn to £22.3bn. The movements take the total amount invested in stocks and shares Isas to £315bn, passing the £270bn held in cash Isas.

The trends have been put down to a cut in interest rates, as well as last year’s personal savings allowance allowing basic rate taxpayers tax-free interest of up to £1000.

Hargreaves Lansdown financial planner Danny Cox says: “Low interest rates and the new personal savings allowance have precipitated a collapse in cash ISA saving. While understandable, this may prove to be short-sighted as neither low interest rates nor the personal saving allowance are necessarily a permanent fixture of the financial landscape, though it’s fair to say both do look set to remain in place for the foreseeable future.”

Cox adds that stocks and share Isa funds overtaking cash Isas’ “reflects the fact that the stock market has produced better long term returns than cash, and also that people investing in stocks and shares ISAs tend to hold them for longer.”



Pensions stickier than Isas for debt-racked Britons

Debt-bound Britons are more than twice as likely to cancel regular payments into Isas than pensions, new research has found. Two-thirds of people with persistent unsecured debts have reduced regular payments into Isas and savings accounts, compared to 26 per cent of those paying into workplace pensions and 43 per cent of those paying into […]


How much are advisers charging for pension transfers?

Defined benefit pension transfer charges are being put under the microscope again as the regulator turns over more potential conflicts of interest. With the British Steel Pension Scheme the latest to dominate headlines and the FCA ready to interrogate further as it extends its review to include all firms authorised to give pension transfer advice, […]


James Hay parent downplays vertical integration concerns

IFG Group has said it is not concerned about its ownership of both platform James Hay and advice business Saunderson House as the regulator prepares to take a look at vertical integration in the advice market. IFG announced its half-year results this morning, showing increases in client acquisitions for both James Hay and Saunderson House. […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment