ISAs here to stay

ReportInvestor

Thanks for the link, James.

Surely decades long proof of decent bond past performance would be be scant comfort were we to see a resurgence of inflation and higher interest rates?

And to what extent are bonds overbought by pension funds & with profit funds for technical reasons?

The attraction of tax free income from share ISAs could also help drive down the value of bonds as baby boomers look to enhance their returns outside pensions.

zag2me

Its a shame the isa limit is not going up with inflation It's been stuck at £3000 for years now.

jamesd

ReportInvestor, decades of history would include at least one high inflation period. What I've seen suggests that bond rates were substantially higher during such periods.

The threat of a high inflation period is one reason why I'm personally not keen on having to buy an annuity with inflation increase capped at 3 or 5% in retirement.

ReportInvestor

Bond rates would have been higher - but your capital value would have plumeted.

Annuities are closely linked to the bond market.