Written by Jennifer Stevenson
13th March 2019

Get fit and pay less for your ISA

Everyone needs some kind of incentive to get fitter, whether it’s feeling healthier, fitting into our clothes, or looking better.

But now a financial product provider is offering a new incentive: a lower-cost ISA.

Newcomer to the ISA market, Vitality, is offering healthy-living discounts on product charges for their Stocks and Shares ISA and their Junior ISA.

Step by step for lower fees

If you take steps to improve your health – for example by literally tracking your daily steps with a fitness device like a Fitbit or an Apple Watch, or going to the gym regularly, buying healthy food, having a mammogram or taking part in a Parkrun – you earn “Vitality points” which add up to your Vitality status.

(Though it’s not a lifestyle which the anti-exercising dachshund Stanley, brand-ambassador in their advertising, is keen on.)

Give up smoking, go to the dentist…

Bronze-status customers win a 40% discount on the annual product charges. Silver status gets a 50% discount, Gold a 70% discount, and Platinum policy-holders get a 100% discount: they pay no annual product charges at all. (Though fund charges still apply.)

A customer with a £25,000 investment would otherwise be looking at 0.5% or 0.65% on annual product fees.

Vitality health savings

  • 10,000 steps tracked in a day = 5 points
  • Going to the gym = 5 points
  • A 30-minute run = 8 points
  • Dental check-up = 100 points
  • Online non-smoking pledge = 100 points
  • Mammogram or prostate screening: 150 points

(Vitality June 2018)

Total Vitality

There are some conditions: you need to have a Vitality life or health insurance plan as well, and the fee reductions only apply to Vitality’s own funds – not all the financial products they offer.

Plus a 15% investment boost

In addition, Vitality offer a loyalty bonus they call the Investment Booster every five years, to encourage you to hold your ISA for longer.

  • Over 25 years the boost adds over 15% to your earnings, on top of any returns.

And ISA customers in drawdown earn higher bonuses if they take out less money, which Vitality says is designed to address the problem of people underestimating their life expectancy.

Start younger, save for longer

Vitality say they want to improve the rather fuddy-duddy image of health insurance and retirement saving, and get away from negative “do this or you’ll regret it later” marketing by tapping into young people’s positive engagement with fitness.

“I don’t think you can divorce management of health from the management of finance,” says Vitality chief executive Herschel Mayers.

“We are trying to encourage people to live a healthier life and fund their retirement.

“We earn additional fee income from people living longer and saving sooner, and we plough that back to the customer in the form of incentives.”

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