Savers could be missing out on millions this year by not making the most of their ISA allowance, according to moneysupermarket.com.

After last year’s increase in the ISA allowance savers can now put away £5,100 in a cash ISA. But figures show that if the 2.6million savers who have previously saved this way don’t hit the new limit they’ll be losing out on a collective £362million.

The research by moneysupermarket.com found that over 15 per cent have not saved and do not intend to save anything this tax year and of those that are intending to save, over half do not intend to use the full allowance.

Kevin Mountford, head of banking at moneysupermarket.com, said: “It is sign of the times that many traditional ISA savers are deciding not to utilise their tax free allowance this year. The current economic uncertainty and rising cost of living is really putting pressure on many households’ disposable income and unfortunately it is savings that tend to suffer when times are tough.”

Putting the full £5,100 allowance away this tax year would earn you just over £100 more than holding the equivalent savings in an average paying easy access savings account before tax.

“However, it is important to try and put some money aside for a rainy day, which can tide you over should your circumstances change. More importantly, easy access cash ISAs allow you to immediately access your funds should you need them, which is an important consideration for many savers,” he added.

Moneysupermarket.com also recommend that savers should aim to have at least three months worth of outgoings in savings and says utilising the tax free ISA allowance will ensure you are maximising the returns.

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