ISA? That's an Australian boy-band, right?

With the end of the tax year rapidly approaching Confused.com is calling on consumers to get clued up about tax free savings.  New research from the price comparison site revealed that 43% of Brit's have never had an Individual Savings Account (ISA) and that 14% didn't know what an ISA was.

Research revealed:

7% think ISA is text speak for I'm So Awesome;
5% think an ISA is a new Australian boy-band;
2% think an ISA is an isotonic sports drink.

When asked how much could be saved into a cash ISA, only one in two respondents correctly knew that the current cash limit was £5,100 per year, with 6% saying there was no limit, 11% believing they could add £500 every month. 5%  knew the total ISA limit (cash and equity) was £10,200 but thought your salary had to exceed £30,000 a year to qualify.  27% admitted they didn't have a clue.

Research also revealed that only 51% of savers have used this year's ISA entitlement.  Given that 22% of respondents said their main savings goal was retirement and a further one in five (20%) said they were saving towards a deposit for a house, Confused.com voiced it's concerns that so few were making use of their tax free allowance to help them achieve these long term goals.

Head of Savings at Confused.com, Chris Griffiths, said: "It's worrying that 14% of Brit's don't know what an ISA is given that they've been around for more than a decade.  It's even more of a concern that two fifths of people have never had one and that 51% haven't used this year's allowance.  An ISA really should be the first port of call for your savings as you can earn interest without it being taxed, giving you a better return and ultimately putting more money in your pocket.  Using your allowance each year can be a great way to help you towards your long term savings goals; as your tax free savings pot grows so will the interest you earn.  Getting an ISA is really straightforward, shop around for the best deal for you and consider managing your account online as these accounts may offer you a higher rate of interest. Remember you only have until 5 April to use your tax free allowance this year."

Other findings include:

18-24 year olds are the least likely to have an ISA, with 50% admitting they've never had one;

9% of 25-34 year old's thought ISA was a text speak abbreviation;

Those aged 45-54 (96%) and 55+ (95%) were most likely to know what as ISA was and correctly identify the cash limit (63% and 62% respectively);

Those in the North West and East Anglia were the most likely to have saved this year's allowance (both 54%) while those in Northern Ireland were least likely to have made the most of tax free saving (just 38%).