Martin Lewis: Cash ISA limit could be cut – this is 'p*ss people off economics'

Shylock_249

Whatever decision Rachel Reeves makes on 15th of July I think it very unlikely that she'll change her mind and reverse the decision. There's only so many U-Turns a government can do and I don't think this would be one of them.

Middle_of_the_Road

Shylock_249 said:

Whatever decision Rachel Reeves makes on 15th of July I think it very unlikely that she'll change her mind and reverse the decision. There's only so many U-Turns a government can do and I don't think this would be one of them.

You're obviously not a betting individual 😄

Jonesy214eva

So, I do a little bit of investing in stocks and shares with cash i can afford to lose. I put my savings in to a cash ISA. If i put my savings in to a S&S ISA, will my savings value go down? Or is just the rate of return/interest that fluctuates?

mebu60

GazzaBloom said:

If the cash ISA limits are reduced it's easy enough to use a stocks and shares ISA and buy a short term money market fund, which is typically viewed as “cash like” and elevate the 2 finger royal salute to Rachel from accounts. STMMFs are typically going to pay interest closer to BOE base rate than high street bank cash ISAs anyway.

Unless they are made ineligible to be held in an ISA. Which then raises the question of whether that is applied retrospectively to previous years' holdings. 

Shylock_249

Middle_of_the_Road said:

Shylock_249 said:

Whatever decision Rachel Reeves makes on 15th of July I think it very unlikely that she'll change her mind and reverse the decision. There's only so many U-Turns a government can do and I don't think this would be one of them.

You're obviously not a betting individual 😄

Agreed, but I bet there won't be a lot of investors voting Labour at the next election who have put the remainder of their ISA allowance (expecting it to be 16k) into S&S for the next 4 years when their individual valuation is much less than the 64k they invested.  Yes, I do realise the value could go up BUT 4 years isn't a long time in investment terms.

kimwp

Jonesy214eva said:

So, I do a little bit of investing in stocks and shares with cash i can afford to lose. I put my savings in to a cash ISA. If i put my savings in to a S&S ISA, will my savings value go down? Or is just the rate of return/interest that fluctuates?

You could lose your entire savings. 

mebu60

Shylock_249 said:

Middle_of_the_Road said:

Shylock_249 said:

Whatever decision Rachel Reeves makes on 15th of July I think it very unlikely that she'll change her mind and reverse the decision. There's only so many U-Turns a government can do and I don't think this would be one of them.

You're obviously not a betting individual 😄

Agreed, but I bet there won't be a lot of investors voting Labour at the next election who have put the remainder of their ISA allowance (expecting it to be 16k) into S&S for the next 4 years when their individual valuation is much less than the 64k they invested.  Yes, I do realise the value could go up BUT 4 years isn't a long time in investment terms.

I was just thinking the same thing, if folk are 'nudged' into investing what they would have placed into a Cash ISA and there's a stock market crash just prior to the next election . . . . . . . . 

Except I don't think many folk will be nudged, especially if STMMFs are made ineligible, and the funds will be just be placed in taxable savings accounts - maybe that's the cunning plan behind all this!! 

Middle_of_the_Road

Shylock_249 said:

Middle_of_the_Road said:

Shylock_249 said:

Whatever decision Rachel Reeves makes on 15th of July I think it very unlikely that she'll change her mind and reverse the decision. There's only so many U-Turns a government can do and I don't think this would be one of them.

You're obviously not a betting individual 😄

Agreed, but I bet there won't be a lot of investors voting Labour at the next election who have put the remainder of their ISA allowance (expecting it to be 16k) into S&S for the next 4 years when their individual valuation is much less than the 64k they invested.  Yes, I do realise the value could go up BUT 4 years isn't a long time in investment terms.

Is that not even more reason to reverse the reduction, if they want to retain votes?

Farway

kimwp said:

Jonesy214eva said:

So, I do a little bit of investing in stocks and shares with cash i can afford to lose. I put my savings in to a cash ISA. If i put my savings in to a S&S ISA, will my savings value go down? Or is just the rate of return/interest that fluctuates?

You could lose your entire savings. 

You are correct, and the unfortunate thing is many who may be tempted with S & S ISA will be blissfully unaware of this & just see the glossy returns

A disaster in the making as newbies loose it all to those who will certainly be after cash ISA money

Shylock_249

mebu60 said:

Shylock_249 said:

Middle_of_the_Road said:

Shylock_249 said:

Whatever decision Rachel Reeves makes on 15th of July I think it very unlikely that she'll change her mind and reverse the decision. There's only so many U-Turns a government can do and I don't think this would be one of them.

You're obviously not a betting individual 😄

Agreed, but I bet there won't be a lot of investors voting Labour at the next election who have put the remainder of their ISA allowance (expecting it to be 16k) into S&S for the next 4 years when their individual valuation is much less than the 64k they invested.  Yes, I do realise the value could go up BUT 4 years isn't a long time in investment terms.

Except I don't think many folk will be nudged, especially if STMMFs are made ineligible, and the funds will be just be placed in taxable savings accounts - maybe that's the cunning plan behind all this!! 

Exactly, take for example one could have saved the 16k at 4.5% = £720 interest free.  That £720 would be notified to HMRC and liable to tax at 20%, ie £144.oo.

Me and my wife have always put the maximum amount (20k) into fixed rate ISAs within the first few days of the new FY so we will be £288.oo worse off because at the age of 77 & 75 we are certainly NOT going to invest in S&S ISA. And we won't get the Winter Fuel Allowance either because that will be clawed back by Rachel too.....

My Suggestions (Minister of Good Ideas!):
Allow pensioners to retain the current 20k rate. 
Allow pensioners like myself and wife who don't have any children to merge ISAs into a Joint Pensioners' ISA, thereby avoiding probate on the death of one of us.