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An increased
interest in
Stocks and
Shares ISAs?

The appeal of Stocks and Shares ISAs has increased slightly with a slip in demand for Cash ISAs. The persistently low interest rate environment, coupled with the introduction of the personal savings allowance, may be the reason why there is a slight draw away from traditional savings accounts.

Research from HMRC has shown the number of cash ISAs subscribed to fell by 1.6million and the number subscribing to stocks and shares ISAs rose slightly*.

*Source: HM Revenue and Customs Individual Savings Accounts (ISA) statistics. August 2017.

The ups

The number of Stocks and Shares ISAs opened in 2016/17 remained constant at 2.5m, with subscriptions up by £1.2bn to £22.3bn.

The downs

Cash ISA account openings dropped by 1.6m to 8.5m with the amount invested falling by nearly £20bn to £39.2bn.

At the end of 2016-17 the value invested in ISA holdings was £585 billion (10% rise from the year before). This is driven by an increase in the market value of funds held in stocks and shares increased by 20% compared to 2015-16. The holdings are split almost equally between Cash ISAs and Stocks and Shares ISAs.

 

Market Share

Cash

£270bn

S&S

£315bn

Market Value of funds as at
5 April 2017

*Source: HM Revenue and Customs Individual Savings Accounts (ISA) statistics. August 2017.

Maximising
tax efficient
savings

Although subscriptions have fallen over the 2014-2016 period, investment has increased and this has been identified due to the rise in the ISA allowance limit.

The limits have increased an amazing 31.2% from 2016/17 to the current allowance of £20,000 and with any growth or income received being free of Income and Capital Gains Tax it is still a possible investment choice for your clients.

 

Overall Market

Around 11.1 million Adult ISA accounts were subscribed to in 2016-17, down from 12.7 million in the previous year

Source: HMRC Individual Savings Account (ISA) Statistics, Aug 2017

All clients are different: some will be able to use their tax-free personal savings allowances to maximum effect, while others may have considerable gaps to fill as they save for the future.

Are your clients
unsure where
to invest?

When it’s time to talk ISAs and your clients are worried about risk and return, it may be worth discussing the Prudential ISA, which is a Stocks and Shares ISA offering investment in a range of smoothed funds with an established smoothing process – an important benefit for clients considering the future. Also available with full online functionality allowing you to complete, submit and track applications online - making client transactions faster and simpler.


The value of an investment is not guaranteed and can go down as well as up. Your client could get back less than they have paid in.


Expected Growth Rate for the Prudential ISA
Find out more on the Prudential ISA

The Prudential
ISA

The Prudential ISA is now available with full online functionality which allows you to complete, submit and track applications online – making client transactions faster and simpler. Online declarations are also available or if preferred the option to declare offline with "Print & Post”.

And there’s lots of payment flexibility too:

  • Clients can pay online by debit card for single investments
  • They can pay by cheque or bank transfer
  • And set up direct debit mandates

Other benefits include:

  • Access to our PruFund funds
  • Can invest in a range of OEIC funds
  • Adviser charging facilitated through the Prudential ISA
  • Minimum of £500 initial investment or transfer and/or £50 regular monthly payment

The value of an investment is not guaranteed and can go down as well as up. Your client could get back less than they have paid in.

The Prudential ISA is provided by Link Financial Investments Limited, who is the ISA Plan Manager. Link Financial Investments Limited is responsible for all regulatory and legal aspects of the ISA and the provision of all customer services, including issuing contract notes, statements and other post-sales communications.

Prudential ISA On-line Service

This link takes you to the Link Financial Investments Limited website. You will need to register with Link Financial Investments Limited to use the ISA application service. Prudential is not responsible for the contents or reliability of that site.

Online capabilities for the Prudential ISA
Find out more

Further reading

ISA





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