Time is running out for savers and investors to make the most of tax allowances before they “reset” at the end of the tax year
As the April 5, 2025, tax year-end looms, savers and investors are feeling the crunch to maximise their allowances before they reset. However, “investment anxiety” is gripping the nation, with a staggering seven in 10 (70%) UK adults put off by factors like lack of expertise or fears of losing money.
Helping ease the pressure, interactive investor’s personal finance guru Craig Rickman presents a no-brainer tip: exploit your Isa allowance to the fullest before it’s too late. The yearly cap stands at £20,000 for fresh contributions into Isas.
Rickman says: “If you have unused Isa allowance this tax year and plan to add more, make sure you do before the allowance resets.”
Diving deeper, he shines a spotlight on the array of Isas up for grabs – think Lifetime Isas, great for first-home dreamers due to a government top-up; Innovative Finance Isas, tying your fortunes with enterprises; and Junior Isas for the little ones’ future. Savers might tuck away cash, stocks and shares, or mix both.
But remember, the Lifetime Isa comes attached with caveats and penalties if you yank out funds under certain conditions.
Rickman’s final word of advice for those mulling over which Isa to pick: “the best one for you will depend on your personal goals and risk appetite”.
Savvy parents are looking into the potential of Junior Isas (Jisas) as a means to secure their kids’ financial future, experts claim. With Rickman pointing out, “While only a parent or guardian can open a Jisa for a child, anyone can contribute once the account is up and running,” there’s room for family and friends to chip in for that much-needed financial head start.
If you’re weighing up savings options, bear in mind what Roger Hattam of Triodos Bank UK advises: “Whether you’re saving in a cash Isa, or investing in stocks and shares or innovative finance, your money won’t just sit there: it will be actively used by your bank to fund whichever businesses and sectors that bank sees fit. And this is where your choice really matters.
“Even a small amount of money can make a huge impact when it’s being invested back into transformative projects that deliver measurable positive impact.”
For those looking to align their finances with their values, Hattam recommends delving into ethical campaigns and scouring independent guides to discover more sustainable and upfront saving strategies.
