Are ISAs still worth it?
Wow it really has been a while since I updated here. Firstly I'll answer the question that some may ask - what is an ISA? An ISA (individual savings account) is a way of saving where you pay no tax on the interest earned. There are certain rules to them such as limits on how much you can invest in a tax year. Now there are two main types - cash and investment ISAs. As investment ISAs are linked to stocks and shares etc I will not discuss them here as there are too many ins and outs for them. So cash ISAs So why may they no longer be worth it? Well the governement introduced a savings interest allowance 3-4 years ago which says that, depending on your income, you can earn a certain amount of interest tax free - regardless of the account it is in. the limits are - basic rate tax payer (20%) - £1000 interest tax free - higher rate tax payer (40%) - £500 interest tax free ...