• 47% of Brits don’t know about the benefits of an ISA
  • 1 in 10 (12%) Brits don’t know what an ISA is
  • 7 in 10 from generation Z (71%) and 3 in 5 millennials (58%) are unaware of the advantages an ISA offers

According to new research by personal finance website finder.com, nearly half (47%) of Brits do not know about the benefits of an ISA and 1 in 10 Brits (12%) haven’t heard of an ISA.

This means a significant portion of the population could be missing out on valuable tax-free savings and investing opportunities.


Younger people are less aware of ISAs and their benefits

Younger generations have a more limited understanding of ISAs than their older counterparts. 7 in 10 from generation Z (71%) don’t know the advantages of an ISA. Only 29% of Gen Z know about ISAs and their benefits, whilst over a quarter (28%) have not even heard of ISAs.

Millennials are slightly more familiar with ISAs compared to the generation below, with 58% not knowing the benefits of investing in an ISA. Meanwhile, 1 in 6 (16%) of millennials do not know what an ISA is.


Older generations are more aware of ISAs

Older generations are more aware of ISAs than younger generations, with nearly 2 in 3 (63%) of those aged 43 and over knowing about ISAs and their benefits. However, nearly 1 in 3 (30%) of this age group have heard of ISAs, but are unsure of the benefits of investing or saving with an ISA.

Meanwhile, only 8% have not heard of ISAs before, nearly 4 times less than Gen Z. The number of people that do not know about ISAs decreases by generation in this age group, with 11% of Gen X, 7% of baby boomers and 3% of the silent generation. This could be due to the fact that older generations are more likely to have money aside for saving or investing and thus have done more research on the best ways to do so.

George Sweeney DipFA, investing expert at finder.com, comments:

“The results of this study show that 1 in 10 Brits could be losing money on their savings and investments due to a lack of knowledge about what an ISA is and how they work. Any profit made by investing or saving can be taxed by the government, but an ISA can be used to shield these gains.

The ISA allowance for the 2024/25 tax year is £20,000, meaning you can put anything up to this amount in a stocks and shares ISA, cash ISA or other type. You can split your allowance across ISA types, although you can only put up to £4,000 a year in a lifetime ISA.

A stocks and shares ISA walks and talks like a regular investment account, but it’s what’s known as a “tax wrapper”. Similar to a pension, it has its own tax rules. Pretty much all investments in this wrapper aren’t subject to any tax. And, when withdrawing money, it doesn’t count towards someone’s income tax (unlike a pension).

If you prefer to save, a cash ISA allows you to earn tax-free interest on your savings pot. In the UK, most people can earn up to £1,000 in interest without paying tax, but anything over that will be taxed – unless it’s in an ISA.

Setting up an ISA is usually dead simple. Typically, a standard account needs to be opened with a trading platform or bank. You can also transfer money from previous years’ ISAs without it counting towards your £20,000 allowance. Just make sure this is done by request through the bank or investing platform rather than withdrawing the money yourself so it doesn’t lose its tax-free status.”
Finder commissioned Censuswide to carry out a nationally representative survey of adults aged 18+. In May 2024, a total of 2,000 people were questioned throughout Great Britain, with representative quotas for gender, age and region.

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