ISA savings are held by many in the UK, with the tax perks they provide making them a favourable option for stocking up on savings. Despite this, ISAs are likely to offer very low interest rates which makes money held in them quickly outpaced by inflation, a problem affecting a specific section of people quite hard.
What are ISAs?
ISA stands for Individual Savings Account. The main difference between an ISA and any other savings account is that it offers tax-free interest payments, so you could get more money for your money.
There is, however, a limit to the amount of cash you can put into an ISA in each tax year, which is called the ‘ISA allowance’. ISA accounts can come in many forms but one of the most popular types is the cash ISA. HMRC have released data on how people are engaging with cash ISAs and analysis from some groups have shown that women hold the highest number of all cash ISAs available.
Dilemma for women
The ratio for groups using ISAs have not changed much in recent years, making women be more than half of all cash ISA holders. Cash ISAs are a common part of many savings plans but they do not often offer great returns through interest. This means that women in particular could struggle with their monetary holdings, especially when considering that they tend to not seek further guidance and help on the issue.
Financial assets need to manage carefully and regularly to get the best possible result. Various institutions, including the government, urge the public to seek financial advice wherever they can.
Jill Elliott, a Chartered Financial Planner, commented on HMRCs figures and stated that “we need to break the cycle of women being over exposed to low returning savings products”. Professional advice is what is strongly recommended to women, rather than leaving the problem to sit.