How To Stop Losing Money From Your Cash ISA
If you are saving into a Cash ISA, you may have noticed that your money isn’t performing as strongly as you’d like.
One of the big factors holding Cash ISAs back has been the rate of inflation. Currently sitting at 2.6%, inflation is above the typical interest rate for most Cash ISAs. That means your money could in fact be losing value in a Cash ISA.
Think about it like this, if you have £1,000 in a Cash ISA, that grows at a rate of 1% each year, after 5 years you would have £1,051. However, if UK inflation was at 2%, your £1,051 would only have the same buying power as £950.
To get around this loss of value, it could be a good idea to invest in a Stocks & Shares ISA. This type of ISA is linked to the performance of the assets held within a fund, meaning your returns have the potential to be much higher than those of a Cash ISA.
A benefit of our Stocks & Shares ISA is the ability to set your goal and track your performance with impulseSave®. This enables you to top up your investment anytime, anywhere. You’ll also benefit from being invested in our True Potential Portfolios, which utilise our Advanced Diversification strategy to maximise returns and reduce risk.
With a Stocks & Shares ISA, you can invest up to £20,000 in the 2017/18 tax year. It is a tax efficient savings scheme, and with our Stocks & Shares ISA you can withdraw at any time without losing the tax breaks. You can reinvest back in within the same tax year, without it counting towards your annual allowance, through our impulseSave® technology.
You can learn more about our Stocks & Shares ISA here.
Your capital is at risk. Investments can fluctuate in value and you may not get back the amount you invest. Tax rules can change at any time.