PIMA reminds savers of ease and diversity of ISA-able investments

With 45 days remaining until the end of the 2006-2007 tax year, PIMA would like to remind savers of the wide range and diversity of ISA-able investments and the simplicity of investing in ISAs.

The ISA is the most popular savings vehicle for individual savings. ISAs are very simple. In the first half of the 2006-2007 Tax Year, over 36 ISAs were opened every minute, adding nearly 54,000 subscriptions each day. ISAs may be opened on the internet, in a local branch, through a financial adviser, over the phone, or by post. Many can be opened and completed in a matter of minutes.

ISAs allow immense diversity. The investments eligible to be included in an ISA now number in the tens of thousands. Investments eligible to be held in an ISA come from all over the world. Investors can gain tax-advantaged exposure in foreign shares in over 40 Recognised Stock Exchanges. However investors looking for a simpler option may invest in UK managed collective investment funds which can invest in securities spanning the globe.

The liberalisation of the ISA scheme by HM Government allows a wide range of investment vehicles to accommodate any lifestyle, risk appetite or life stage. These include:

cash accounts
money market funds
insurance products
shares
Investment Companies with Variable Capital (known to many as OEICs)
Investment Trusts
Unit Trusts
Corporate Bonds
Gilts
certain types of collective property funds, including the newly available REITS (Real Estate Investment Trusts)
Exchange Traded Funds

February is an excellent time to review ISA subscriptions before the tax year end. Many people can expect to receive at least two more pay packets before 5 April. This will prompt a few important questions.

Those who already have 2006-2007 ISA subscriptions must decide how much more they can contribute this year up to the limit of £7000? In the next tax year, should they make their savings lump sum or monthly direct debits?

Some might not have started saving in their first ISA yet. For them, the big question is—Is now the time to start a savings habit? Many providers and advisors have extra staff and resources during this run up to the end of the tax year to provide precisely the help they need, no matter how little they intend to save in the next 45 days.

PIMA Director General Tony Vine-Lott said, ‘ISAs are a hugely popular savings scheme and bring financial benefit and security to many. The more people understand them, the more popular they become. They allow diverse investment in many different kinds of financial products.

Throughout the festive period, there are many excuses for not saving, but with spring on the way and the end of the tax year upon us, it’s time to think about how to maximise savings. If consumers have questions, they should seek advice from their branch, financial adviser, or financial provider.’