There are lots of ways to save money, of course, but one of the best ways around is to open an ISA. The ISA – short for Individual Saving Account – is a good way to save since it’s tax free, so in the great majority of cases you get better interest rates than for a simple savings account, and there are different types of too – meaning that your money doesn’t have to be locked away long term.
If you save with a cash ISA there’s a limit to the amount of money you can put in each year – this currently stands at around £5700. ISAs are often described as a tax free ‘wrapper’ that you can save in, plus in addition to cash you can also have investments in ISAs too such as stocks and shares.
Obviously, tax free savings are ideal if you have a few thousand to squirrel away and are happy to let the money stay in the one place gathering interest. But if you have more money you’d like to invest, stocks and shares ISAs provide a fexible way of doing this – although as with any share type investment it’s important to be aware that the value of what you hold can of course go up or down – so there is the risk that what you get out at the end could be less than what was paid in.
Some providers such as AXA Self Investor allow you to pick from a number of funds you want to invest in rather than have to research and purchase individual shares yourself. This is a good way to invest if you’re confident enough to make your own investment decisions independently but haven’t the time to be scrutinising the FTSE100 and other stock indexes in order to track prices – plus all the other research that goes into assembling a portfolio.
If you’ve got questions about stocks and shares ISAs then have a word with your independent financial advisor, who should be able to help.
Oh, and by the way – if you want to open an ISA with this year’s tax free allowance, then it’s time to get moving, since there’s not a lot of time left – only 16 days, in fact!
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