New Tax Year, New Isa! | Savings

by NigelSmith

With April looming, it's that time of the year again when financial institutions begin to roll out their ISA (independent savings account) offerings. ISA season is now in full swing ahead of the new tax year and all the usual names are looking to attract potential investors who are eager to use their full ISA allowance for the year.

The new tax year also welcomes quite a substantial increase in the total ISA allowance. The overall limit has been raised from 7,200 to 10,200, a limit that was previously only available to those over 50 years-old. This increase is sure to stimulate improved interest in ISAs come April.

If you don't use your annual ISA allowance by April then you can't carry it over into the new tax year. That makes it the ideal time to start researching what's on offer at the moment and get an idea of which is the right and most profitable ISA for you.

There have already been some great deals showing up on cash ISAs. They can pay up to 3.5 percent and are guaranteeing 3 per cent higher than the interest rate. There are also some great offers on ISA transfers which offer as high as 2.75 per cent interest. However, it is often advisable to bide your time and see if more attractive offers can crop up.

There are also stocks & shares ISAs (also know as equity ISAs) available and these have become increasingly popular with investors. These Isa's can offer a larger return but also carry a higher amount of risk in comparison to cash Isa's.

If the stock market was to plummet as it did recently in 2008, a significant chunk of savings could easily be lost. The risk is also exacerbated by the by the limit on equity ISAs being double that of a cash Isa.

Due to the continued unpredictability of markets, the increased popularity of ISAs is only set to continue. Over recent years, the economy has been on a downturn and extremely erratic making ISAs a much safer and more appealing option to investors as opposed to other alternatives.

With banks and building societies eager to attract new investors, there's guaranteed to be some great ISAs and possibly even better to come! Now is the perfect time to start investigating in order to take full advantage of your annual independent savings account allowance.

DISCLAIMER: This article is provided as information only and is not to be taken as financial advice.

To find out more about taking out an ISA and ISA transfers, take a look at the offers from Leeds Building Society