4 in 5 savers unaware of upcoming ISA rule changes

Almost 4 in 5 (78%) of savers are in the dark about a rule change that will allow them to open multiple ISAs of the same type within the same tax year from April, according to a new report.

When made aware about the change, 31% said it would make them want to invest more money into ISAs, according to the survey from financial services mutual Wesleyan.

Of the 2,000 savers surveyed by OnePoll on behalf of Wesleyan, 42% already had money in an ISA.

This rose to 55% for those aged 65 and over. Those aged 35-44 were least likely to have money in an ISA (33%).

Over three quarters (76%) of ISA savers had opted for Cash ISAs, with 29% holding Stocks & Shares ISAs.

Their main motivations for investing in ISAs were to benefit from the tax advantages (51%), to grow their money (33%) and invest for their retirement (25%)

Toby Hester, deputy product officer at Wesleyan Assurance Society, said the rule change from next month will allow savers to shop around and achieve better returns on their ISA investments.

He said: “Being able to open more than one ISA of the same type and switch between providers will give people the freedom to shop around for better deals and achieve better returns on their investment.

“And it means they can create a portfolio of ISA investments that’s more varied and balanced to their needs, which can provide more security and peace of mind during times of market volatility.”

However, the research also unveiled some confusion around ISA terminology.

Seven in ten (70%) of those surveyed did not know how the different types of available ISAs work, and close to half (45%) believed you needed large sums of money to open an ISA.

• OnePoll surveyed 2,000 UK adults between 27 December and 8 January.