Increased ISA allowance - Why we should be thanking George!

Since the age of austerity started, no budget has really given the UK population a reason to want to say “Thank you George Osborne”, as of 1 July the savers amongst us should be saying exactly that.

From 1 July, the ISA allowance will be increased to £15,000.  For the first time, the full allowance can be used for cash, not just stocks and shares.  In another change, Stocks and Shares ISAs can now be transferred into Cash ISAs, helping those with spending plans coming up be able to budget more effectively.

 

At a time when interest rates remain firmly in the doldrums, the ability to save a little tax and therefore boost overall returns is a welcome relief.

 

I am frequently asked, “Should I bother with an ISA?”  Although ISAs aren’t racy financial planning, they are - in my opinion - essential housekeeping for all of us.  A married couple fully utilising their ISA allowance each year for 10 years, earning 3%, could have a tax-free lump sum of c.£384,000 at the end of the period.

 

Pay off the mortgage? House deposit for the kids? Second property? Early retirement? Spend it how you want, but when you do, remember to say thank you to George.

 

Stuart Moss

Senior Consultant

Telephone: +44 (0)20 7893 3456
Email:  getintouch [at] broadstoneltd.co.uk