Weak rates on cash will see more individuals opt for stocks and shares ISAs in the search for better returns says UK’s largest independent private client portfolio manager Brewin Dolphin.<\/p>
Brewin Dolphin, which so far this current tax year has seen record ISA sales of £91 million – a 10% increase on this point last year*, says that although placing cash in an ISA makes sense for many savers due to their low risk profile, increasingly, investors are turning away from cash due to the low interest rates on offer through the current and 2009\/10 tax year.<\/p>
Recent statistics from the British Bankers Association show that withdrawals from cash deposits last month totalled £2.3 billion as returns fell to the lowest rates since records began. Additionally, statistics from the Investment Management Association (IMA) show that in December 2008 net sales of ISAs were at their lowest since their introduction ten years ago with outflows of £1.6 billion and almost a 700,000 drop in the number of those holding ISA accounts compared to December 2007.<\/p>
Brewin Dolphin’s Charlotte Black, Director of Corporate Affairs says, “Given recent government borrowing, taxes are highly likely to increase over the next few years. Therefore, where at all possible, people should save as much as they can in a tax free fund as protection against those potential rises. Whether this is in an equity or cash ISA will depend on the circumstances of each individual.<\/p>
Black continues “Cash ISA’s certainly seem a poor bet this year given that the interest rates have dropped to almost nothing. However, taking up a stocks and shares ISA, with a long term view and when share prices are certainly lower than they have been, has historically proved to be a prudent move. Of course unlike cash ISAs, the value of stocks and shares can rise and fall, but it is also possible to invest in corporate bonds or hold the funds in cash in the ISA wrapper, until deemed safer to invest in riskier but potentially more profitable assets. The key is to use the allowance before it expires on 5th April and not lose it, as almost certainly taxes will increase ere long.”<\/p>
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For further information please contact the Press Office on 0845 213 3026<\/p>
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Stocks and shares ISAs appeal as rates on cash set to fall to lowest levels in 300 years<\/p>\n","protected":false},"author":97,"featured_media":0,"template":"","meta":{"_acf_changed":false,"rbc_url_alias":"","footnotes":""},"tags":[],"rbcwm_news_category":[],"class_list":["post-3091","rbcwm_news","type-rbcwm_news","status-publish","hentry"],"acf":[],"yoast_head":"\n