Stocks and shares ISAs have been backed by IFAs (Independent Financial Advisers) to outsell cash ISAs when the increased ISA allowance is rolled out to all savers in the new tax year.
In a nationwide poll of IFAs, Virgin Money has revealed that 20 per cent have said they expect investment in stocks and shares ISAs to increase when the ISA limit is raised from £7,200 to £10,200 on April 6th, compared to one in ten IFAs who think cash ISAs will prove more popular with investors.
Meanwhile, two in five IFAs believe that the new ISA limits – which are already available to savers aged 50 or over – will boost stocks and shares and cash ISA investment when they come into effect on April 6th.
Despite investors being able to shield more of their savings from the taxman when the new limit is introduced, one in five IFAs have predicted that the new entitlements will have no affect on ISA investment, which soared to an eight year high of £2.8billion in 2009.
However, Virgin Money has revealed that the increased ISA allowance for over 50s has already made an impact, with investors more than doubling their lump sum contributions between October 2009 and January this year.
Commenting, Grant Bather, spokesman at Virgin Money said: "The over-50s have led the way and other savers are set to follow suit once the ISA threshold is increased to £10,200 in the new tax year."
The financial provider has announced that it expects to see record sales in this year's ISA season with ISA investments continuing to increase over the past three months.
"It is a welcome boost for the ISA season which in previous years has hardly materialised in any real shape or form. We would urge all investors to consider making the most of their tax-free investment threshold this year and to consider increasing it in the new tax year," Mr Bather added.
© Fair Investment Company Ltd
