Sep 20 2007
ISAs, in particular cash ISAs are becoming "the most popular" type of savings account on the market, an article has suggested.
According to Every Investor, cash ISAs can help consumers to build their savings at a faster rate than traditional savings accounts. This is because no tax is paid on the money in the account, so funds invested can grow freely.
The publication also notes that the government is planning a revamp of ISAs during 2008 in a bid to make saving more attractive to more people.
Maximum investments in ISAs each year are currently capped at £3,000 but from next year this will increase to £3,600, while funds invested will also earn interest from the day they are submitted, rather than after payments have cleared.
Meanwhile, Every Investor notes that interest rates on other savings accounts are not as high as they are on ISAs, so returns on funds will not be as large as through an ISA.
There are two main different types of ISA available - cash and shares - although each account differs in terms of interest rates and investment requirements.
