Robbing Rachel’s ISA Reforms

[TheSassyTraybake]

Although not mentioned in her speech the document released by the treasury hints at reforms to ISAs to “get the balance right between cash and equities to earn better returns for savers, boost the culture of retail investment, and support the growth mission”.

Nothing concrete as yet but looks like they are planning to move against cash ISA’s, either reducing the annual limits or the amount that can be held in them.

Personally I think a cash ISA is a waste of time, but that’s because I use my annual allowance for stocks and shares.

Interested in other people’s thoughts?

The problem is the headroom keeps getting wiped out. £9bn wiped after last budget then half that by markets today.

Or someone who is a fan of alliteration?

But what if you already have the maximum in premium bonds? I want to spread our £40k between savings and a S&S isa. I'm also paying 40% on my interest over the allowance.

Are you meaning a different generation? I’m a millennial, I have adult children, bought a house when I was 21 and paid off my mortgage completely several years ago.

Maybe Gen Z? They are the ones paying into ISAs to buy a house (my DC)

Millennials were born between 1981 and 1996. The ones I know are the later ones, in their early 30s.

Well the OBR didn’t know about it. 🤷‍♀️

Stocks & Shares ISA can have cash like products in them, such as Royal London Short Term Money Market Fund. So pushing people into S&S ISA does not mean they would invest.

Equity investment is really not suitable for older people or people who are saving for a short to medium term purchase. If the market crashes there may not be enough time for it to recover - if this is their plan then it’s not going to change behaviours, just raise more tax revenue. I’d rather pay tax on some of my savings than push it all into higher risk investments. Im
sure that’s the idea 🤨

right but lots of people DONT want to take a risk
which is why they don't invest!
Other reasons would be because usually investing is for long term, some people might not have that long to wait, or want easy access to their cash.

Not everybody WANTS to potentially earn significantly more money, just to keep the money they do have safe (and ideally earn sufficient interest that it doesn't depreciate in real terms).

I can see why she's thinking of it, but not sure if it will work, at least to the extent she's hoping.
If cash ISA allowances were reduced stocks and shares would be way down my list of options for what to do with my savings

Stocks and shares ISA is definitely not for everyone. Yes I've made a good return but the past week my portfolio had gone down by 15% which is a lot. You should only invest in stocks if you can bear the risk and it is risky. Ig is utterly unfair to force it on everyone including those who rely on the money as their only life saving.

You can hold gilts in a S&S ISA. Effectively no risk, as good as a cash ISA.

Nobody is being pushed to invest in equities.

Just a rethink on tax exemption for cash deposits.

Yes I suppose so @Bromptotoo . I must say I was surprised when we suddenly accumulated lots of cash in the last few years (inheritance, pension lump sums etc), to discover that the cash ISA limit was as high as £20k,since I remember a few years previously it was only about £3k per annum.

It is mainly the wealthy that benefit from that I suppose. (this is only temporary for us to have so much in savings as we'll soon need it to buy a property) The well off can manage without this help, particularly with the state of the economy as it is.

I doubt that we'll be converted to invest in shares though, we won't be able afford the risk in the future.

Robbing Rachel. Grow up.

For me too, my ISAs are largely my tax free lump sum + redundancy. Some S&S, some cash, depending on the term I expect to leave it for. I have never had this much ££ in my life, nor do I expect to again, it will gradually dwindle now.

I must be punished for this!
I have already been hit by reducing dividend allowances and reducing CG allowance.

I wonder what the future of Premium Bonds is as I assume the chancellor will know that people will buy more bonds / open up new Premium Bonds accounts (if they’ve not already gone to the £50K max) to avoid paying interest or investing in stocks and shares ISA’s, if the cash ISA reform happens.

That’s a few people now, get over it FFS, hardly an offensive nickname. I could call her much worse and it would still be accurate!

You don’t need to call her any names at all. Name calling is puerile.

So far she’s shown herself to be useless and making things worse not better. I didn’t think things could get worse but she’s managing admirably. Be another few years to the next election so I can either panic about the disaster our country is continuing to be, emigrate and move somewhere that is better run, or quietly poke fun and hope for the best. Which is what I’m opting for.

Either way, people need to lighten the fuck up.

There’s plenty of posts doing the same to non Labour politicians, don’t worry about it.

It's a stupid way to start a thread if you want led a reasonable discussion. Makes you sound like a DM journo or someone with an agenda.

Hilarious considering all the nicknames used by lefties against the Tories over the years!!

The ego of some people on here is hilarious. As if every comment they make is important enough to be printed in a newspaper. I don’t know about anyone else but I really don’t put that much thought into my posts on here. Supposed to be a relaxing thing. But you always get some boner killer wanting to spoil the party.

ISAs are our main way of saving to avoid paying tax. We’re retired, paid off our mortgage and put our spare cash into this way of saving, I’ve always voted Labour but now feel as an older person I’m being targeted for the funds I’ve worked hard for all my life. I’m now considering moving to a European country that welcomes and values us. I think many may do similar.

The same ones who sang ding dong the witch is dead when Maggie passed away.