ISA’s what you need to know…
Posted: Saturday March 30 2019
By: Guest Bloggers
ISA's what you need to know. If you’re not sure what is means then chances are, you don’t have an ISA. The Individual Savings Account (ISA), is a tax-free savings account where, as of this tax year (6th April 2017 – 5th April 2018), you can save up to £20,000 without paying a penny of tax on the interest earned. That’s very good news for those who want to save and earn a little extra, or a lot extra, depending on what sort of ISA you opt for. Savvy savers are trying to reach their limits in ISA’s to maximise tax-free interest returns before this tax year ends on 5th April 2018 and here’s why you should too.
ISAs what you need to know…
By Polly Ker – Optimum Financial Solutions
The Best Option for Saving?
ISA’s what you need to know. Whether you’re an experienced saver or not, the ISA represents one of the best options for saving your money. Because of the Personal Savings Allowance (PSA), if you’re a basic-rate (20%) tax payer with less than £20,000 in savings, you can earn up to £1,000 per year in interest tax-free. If you’re a 40% tax payer, you can earn £500 in interest before you get taxed on it.
If you’re saving for a wedding, a new car, your first home, your future or your children’s university fund, chances are you’ll be saving more than £20,000, which means that any surplus funds in your current account could be and should be earning you money.
ISA’s: The Facts
You can open one ISA per year and save up to £20,000 in each. So, if you find yourself in a healthy-money relationship, you can continue to save the full amount per year, tax free and keep earning interest on each of them.
Here’s a look at some of the ISA options:
Cash ISA – These can be opened by anyone age 16+. The cash ISA is like an instant access savings account as you can withdraw money whenever you need if it’s an easy access ISA. If it’s a fixed rate ISA, you’ll have to leave your cash in there for a certain amount of time to get the best rates.
Stocks & Shares ISA – With this type of ISA, you’re investing your money into stocks and shares, either individual companies or government bonds.
Lifetime & Help to Buy ISA’s – Although you can save less in these i.e. £4,000 and £3,000 retrospectively, you can receive an extra 25% on these to boost your savings, from the government. They work well if you’re saving for your retirement or a first home.