Regular UK savers plan to use the government’s new Isa rules from 1 July, but cash Isas are far more popular than stocks and shares Isas, according to research from HSBC.
A May survey of 2,000 UK adults found that 21 per cent will save more in a cash Isa, whilst just 7 per cent of savers say they will save more in a stocks and shares Isa.
It also revealed that 46 per cent of those who have an Isa do not use any of their stocks and shares allowance. However, those who do say stocks and shares Isa savings make up a third of their entire savings portfolio.
Of the 1,017 who said they saved on a regular basis, total Isa savings currently stand at 38 per cent of their overall savings portfolio.
The average Isa saver has £5,361 in a cash Isa and £2,762 in a stocks and shares Isa. As it currently stands, there is a limit on what can be put into Isas. Currently, there is a limit of £11,880 of which £5,940 can be in a cash Isa.
From 1 July 2015, the two types of Isa vehicles will be merged as announced in the Budget. The New Isa, known as Nisa, allows transfers between the two types. The government also raised the annual investment limit into Nisas to £15,000 which can be solely in a cash Nisa, a stocks and share Nisa or a combination of the two.
Oliver Cook, HSBC’s head of savings, said that the new Isa rules give savers more freedom and choice when it comes to managing their savings and maximising their returns.
He said: “Whilst some will be able to use their new allowance to the full, it’s also a good time to start a regular savings habit.”
