There is little doubt that individual savings accounts (ISAs) have become extremely popular in recent years. For millions of households across the UK, they have become an essential financial asset. However, for those investment planning in Cheshire and Oswestry, there may be questions regarding whether that is still the case.
Recent data shows that the total amount of money stored in ISAs is on a trajectory to top £1 trillion for the first time. Figures compiled by AJ Bell in 2023/24 estimated that £360 billion was held in cash ISAs, and £511 billion in stocks and shares. Much ISA wealth is accrued with the long term in mind. The accumulated value of investments doubled in the decade starting April 2014. A typical ISA investor is said to put around £7,594 into stocks and shares annually.
However, the UK Chancellor announced measures in the last Budget that may make ISAs less appealing for future savers. From April 2027, people aged under 65 will be entitled to a less generous £12,000 allowance, down from £20,000 for the current tax year and next. To date, over 2.5 million people have made full use of the £20,000 allowance. Across the population, the average amount held is approximately £34,000.
Many savers have made significant amounts of money through ISAs, with the total number of ISA millionaires reaching 5,000. Following the announced changes by the government, the pressing question for savers moving forward is whether ISAs still represent good value.
