As the new ISA limits are rolled out to all investors from today, almost a third of Brits are planning to invest their allowance at the start of the new tax year, according to Barclays Stockbrokers.
With investors now able to invest up to £10,200 in a tax efficient ISA, the online stockbroker has revealed that 31 per cent of investors do not want to wait before they invest a lump sum, while more than three quarters are planning to take advantage of the increased allowances sometime this year.
Encouragingly, more than half – 59 per cent – of investors have also said that they will utilise their full increased allowance in order to maximise the tax benefits, with 29 per cent saying that the prospect of higher returns was the key factor for planning to invest in stocks and shares rather than cash.
Barbara-Ann King, head of investments at Barclays Stockbrokers believes it can be beneficial for investors to use their full allowance at the beginning of the new tax year.
"By investing your ISA allowance at the start of the tax year, you can effectively get an extra year of tax free growth compared to someone investing on the last day," she explained.
Ms King's claims are backed up by research from Fair Investment Company, which suggests that an investor could earn more than £700 in interest this year by investing their full allowance now into a market leading stocks and shares ISA like the Schroder Income Maximiser ISA, paying a target yield of seven per cent.
Meanwhile, early bird savers could earn around £200 this year by using their full cash ISA allowance into a market leading deal like the RBS Royal Deposit Plan, paying a fixed rate of four per cent over three years.
Commenting, Rebecca Sargent, savings and investments spokesperson at Fair Investment Company said: "If you can, it is worth investing your full ISA allowance, or as much as you can, now, because the longer you leave it, the less you'll earn.
"Take advantage of the new limits and use them to their full potential."
© Fair Investment Company Ltd
