Nationwide calls on savers to make full use of ISA allowance

Less than half of ISA holders intend to save more when limits are increased according to new research from Nationwide Building Society.

The building society claims less than half (48 per cent) of ISA holders intend to save more in their ISA when the revised limits come into effect in April.

And it says ISA holders are not making full use of their tax-efficient allowance in the current tax year as it is.

Almost a third of savers (28 per cent) told Nationwide they did not have any money to save while four per cent did not know how much they topped their ISA up by.

Meanwhile, nearly 30 per cent of ISA holders said they only saved up to £1,000 in their ISAs.

A further ten per cent of ISA holders saved between £1,000 and £2,000, while 20 per cent of ISA holders put between £2,000 and £3,000 into their account.

Just eight per cent of ISA holders topped up their stocks and shares ISAs by more than £3,000.

When asked what stopped them saving more in their ISAs, 58 per cent replied they would like to save more but do not have the money to do so.

Moreover, ten per cent of people do not want to save any more, suggesting they feel they save enough. Another nine per cent of respondents said they do not save any more into their ISA, as they "prefer to keep their savings in an instant access account".

Matthew Carter, director for savings at Nationwide, said: "With just over a week to go before the new ISA limits come into force, work needs to be done to encourage people to make the most of their ISA allowance.

"With one in ten ISA holders opting to save in a regular savings account instead of their ISA, it is essential that consumers are educated about the benefits of tax-efficient savings and how most ISAs allow instant withdrawals.

"Nationwide calls on all would-be savers to make use of their ISA allowance - with only a week to go until the end of the tax year, now is the perfect time to start saving."