MSE News: Call to raise cash Isa limit

innovate

AirlieBird wrote: »

The majority of the cost of ISAs is from Cash ISAs, S&S ISAs cost very little to the exchequer so there is no chance of putting up the Cash ISA allowance, and if he did that would mean more cuts elsewhere to pay for it.

dunstonh wrote: »

Cash ISAs are far more expensive to the treasury than S&S ISAs.

I have googled and found nothing useful - - does anyone have any figures to hand on how much the Treasury has spent to date on ISAs?

AirlieBird

I cant get total figures but around £14bn since 2004-05. Latest estimate is £2.1bn for 2011-12 - but bear in mind that the cost of ISAs is being surpressed by low interest rates (e.g. cost fell from £2.2bn in 2008-09 to £1.6bn in 2009-10.)

opinions4u

I don't think the cash ISA limit is unreasonably low.

What I would do is make the S&S ISA limit completely independent of whatever you have in cash ISA.

£5,340 cash ISA; £10,680 S&S ISA - an individual being allowed to utilise both allowances fully.

Plus the usual indexation.

dunstonh

What I would do is make the S&S ISA limit completely independent of whatever you have in cash ISA.

And call them by a different name to reduce confusion. Maybe PEP and TESSA

Derivative

The cash ISA limit seems fine to me. £5000 is right about the mark for emergency savings.

To really cater for home deposits it'd have to be whacked up much further. Even £10k a year is too low for a home in the SE.

In addition, I don't think it would go down too well given that most in the UK don't put anywhere near £5k away as it is.

opinions4u

dunstonh wrote: »

And call them by a different name to reduce confusion. Maybe PEP and TESSA

Makes complete sense to me.

Different names. Different entities. Less confusion. More take up.

pqrdef

Seems like there's a golden opportunity here for Nationwide to get off their !!!!!! and devise an investment product linked to the property market that would be as cash-like as possible consistent with the rules for S&S ISAs. Investors would get higher rates in return for defraying some of the risk of negative equity.

oldvicar

dunstonh wrote: »

And call them by a different name to reduce confusion. Maybe PEP and TESSA

Great idea. Just like under the last Tory government.

Labour invented the ISA label simply because they couldn't bear the thought that something the Tories invented was a success.

But what names could be acceptable to a Liberal coalition?

Tycoon Savings Account?

Tax Avoidance Special Shares Account?

opinions4u

oldvicar wrote: »

Great idea. Just like under the last Tory government.

Labour invented the ISA label simply because they couldn't bear the thought that something the Tories invented was a success.

But what names could be acceptable to a Liberal coalition?

Tycoon Savings Account?

Tax Avoidance Special Shares Account?

Tories Or Some Strange Alliance works well as a name.

Although that's nothing to do with tax free savings ...

antenna

Nationwide are a fine bunch to say they would like to help their savers.
Invested in a "Online Isa" at 3.1%.....they then close that and the rate falls to 2.75%.....then they promote a Online Isa 2 at 3.1% but dont tell original investors....then,once you invest in this one they close it and reduce the interest rate again.......then,believe or not start a Online Isa 3 at the rate of 3.1%......all the while when you look at your isa online the rate you are getting is NOT disclosed.....very shoddy practise by the Nationwide......i have complained and they tell me they are "working" on putting the rate your isa is earning on your isa account statement on line.....what have they got to hide?.....falling rates with no information.