Only one-third of eligible savers have taken out an Isa

12 June 2007
Isas should be simplified to help individual users save, according to independent finance site

Although over 17 million people already hold an Isa, with £220 billion collectively invested in the tax-free savings vehicles launched in 1999, misconceptions are rife, the site claimed.

"Myths and misunderstandings" prevailed, with four in five people thinking Isa season ended in April while one in four believed that only those who pay tax could open an Isa.

Many also feared they would not be eligible to open an Isa unless they could invest a lump sum, despite the fact that just £1 is needed to begin saving.

David Kuo, head of personal finance at, has called for better government information to clarify the advantages of Isas, since only one-third of people eligible have invested in the savings vehicle at present.

Nevertheless, reported last week that consumer take-up of fixed-rate Isas is on the rise.

Many providers of both variable rate Isas, which track the base rate and grow or decline in value as the base rate rises and falls, and fixed rate ISAs offer competitive interest rates of six per cent, showed.

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