ISA – Happy 21st Birthday!

The Individual Savings Account (ISA) was launched in 1999 and it hasn’t looked back. It’s estimated that 42% of adults have one, which is not surprising considering how simple and tax-efficient they are.

When the ISA was launched, the annual allowance was just £7,000. It has risen steadily over the years and this tax year you can contribute up to £20,000. Those who have made use of their stocks and shares annual allowances over the years could by now have put just over £206,000 into their ISA accounts.

Choices choices

At inception there were a limited amount of accounts on offer, including the cash ISA and the stocks and shares ISA. Since then, the range has increased to include the Junior ISA for children, the Help to Buy ISA for first-time buyers, and the Lifetime ISA for those looking to save for a deposit on a property or for retirement. The Help to Buy ISA is no longer available to new applicants, but if you hold one, you can continue to save into your account.

It’s a good idea to put plans in place as early as possible. The longer your money is saved or invested, the more time it has to produce tax-efficient returns.

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated