ISA continues 25-year success story as savers invest for the future

For immediate release: 5 April 2024

Marking the 25th anniversary of the ISA, the Investment Association (IA) and Opinium have surveyed 1,000 investors to take the temperature on their attitude to ISAs and investing, with three key findings revealed:   

• Team GB - Investors showed a strong interest in the proposed UK ISA, with almost four out of five (78%) saying they’d consider opening a UK ISA. Almost three in five (58%) believe it is important that their current Stocks and Shares ISA is invested in UK companies. Younger investors, aged 18-34 years, felt particularly strongly, with 29% believing this was very important, compared to 9% of those aged over 55 years. Investors still, however, saw the benefit of a diversified portfolio with 70% agreeing that investing in a range of globally diversified companies would help them meet their financial objectives.  

• Keen for green - Sustainability remains important to investors, with nearly half (47%) of investors actively seeking out funds that are sustainable. This is particularly true for younger investors, with two-thirds (66%) actively seeking such funds, in comparison to 28% of those aged over 55 years. Younger investors are also more confident that sustainable funds will help to meet their investment goals. Nearly a quarter (23%) strongly agree that they can meet their financial goals investing sustainably compared with 7% of over 55s.   

• Crypto caution - Two thirds (64%) of investors agree that traditional assets would deliver a better return than crypto currencies over the next three years - a finding which is consistent between men and women and across age groups. Only 7% of investors disagreed with this statement.  

As the next tax year starts, many investors will have taken the opportunity to top up their ISA allowances. With the average amount invested into a Stocks and Shares ISA in 2023/2024 tax year reaching £6,690, almost half of investors (46%) are saving for retirement, while more than a quarter (28%) are putting money away for a rainy day. Among younger investors saving for a property was a key motivator, with 44% focused on this goal.    

Despite the continued high cost-of-living, 38% of investors ended this tax year having invested more than in the previous tax year. However, 14% have cut back on saving into their stocks and shares ISA. High energy and food bills impacted a third (35%) of investors, while a third (34%) also noted the higher interest rates on cash savings, in comparison to 20% in 2023. Rising mortgages rates also hit a fifth (19%) of investors – double the number of investors than in 2023. This had a greater impact on younger and middle-aged investors with a quarter of those aged between 18-54 years affected, in comparison with only 7% of the over 55s.   

Commenting on the results, Chris Cummings, Chief Executive of the IA said: “Savers across the UK have been taking advantage of their annual ISA allowance as the tax year comes to a close this week. The ISA has been a clear success story, and 25-years on from its creation, it is providing a valuable, tax-efficient way for individuals to save for the future.   

“Our research reveals that younger investors back British businesses - a quarter of younger investors strongly believe in the importance of boosting capital flows to British companies and were more positive that investing in the UK could help them to meet their financial goals.  Whilst all age groups are keenly interested in the ISA’s next chapter, the UK ISA holds most appeal for the young.”   

Notes to Editor:

• To view the IA’s ISA Barometer 2024 report

• The IA and Opinium surveyed 1000 UK retail investors across different age groups and regions of the UK about their goals for saving into a stocks and shares ISA. The survey was fielded between the 13th and 17th March 2024.   

• Investors taking part in the survey ranged from new investors with less than 12 months experience to more seasoned investors with 10 years under their belt. Some investors make investment decisions entirely independently, whilst others entrust investment decisions to their financial advisers and many do a bit of both. 61% of the investors we surveyed were men and 39% women. 40% of the investors in our survey were over the age of 55 and a similar proportion (39%) were aged between 35 and 54. The youngest age group - 18-34 year olds - made up 22% of respondents.​

• There are 22.2 million adult ISA holders for 21/22 tax year. Of those, 7.3 million hold a stocks and shares ISA.