Record deposits in banks for April

According to recent reports April saw consumers in the UK deposit record savings in high street banks, with many rushing to take advantage of higher returns on deposits. Reports show that there was a surge in the level of deposits made by savers in the UK, with many trying to put money aside in order to try and combat the increases in living costs. However, the report also showed that only 50% of consumers see the need to put money aside in savings. Read more

Tags: bank deposits, high street banks, consumers, ISAs, record, Offshore bank, savers, Financial institutions

Cash stashed at home will ‘drop in value’

Savers who prefer to keep their money stashed away at home rather than in a savings account are missing out on interest and will only see their funds drop in value over time, the Newcastle Building Society has said.

The senior marketing executive at the building society, Steve Urwin, noted that not only will people not be earning interest on their savings but that the effects of inflation mean that money sitting at home will continue to “decrease in terms of relative value”.

Mr Urwin also pointed out the security risks of leaving money at home, since it is a prime target for burglars.

According to the Daily Mail building societies saw deposits hit a record high last September, with the biggest demand being for savings accounts and cash Isas.

The Newcastle Building Society said that this trend is an indication that people are becoming more cautious with their savings as they start to feel the effects of the credit crunch.

Tags: mean, inflation, prime target, indication, ISAs, money, Steve Urwin

Up to 50% of Isa investors are contemplating self-select

More than half of Individual savings account (Isa) investors prefer to make their own decisions when it comes to investing, a new study has shown.

The results from Barclays’ survey reveal that ten per cent of investors would like to be more involved in their Isa.

Meanwhile, a third of Isa investors have opted for self-select and a further 24 per cent are thinking about taking one out.

Tom Ryan, director at Barclays Stockbrokers, said: “Self-select Isas have empowered investors, giving them the freedom to make their own decisions and to take control of their investments.”

The added attraction with the product lies with the option it provides to buy and sell when the consumers prefers, he added.

Up to 75 per cent of investors said they were attracted to self-select Isas because they like to make their own decisions.

From April 6th, new updated charges will come into effect for all Isa accounts for the 2008-09 tax year.

Tags: Barclays Stockbrokers, ISA, barclays, Self-select, new study, ISAs, cent, investors

Savers not taking full advantage of Isas

Up to one in three savers are not taking advantage of their tax-free allowance with their individual savings accounts, according to new research.

Findings from Marks and Spencers Money shows that by not saving the maximum of £3,000 in current and previous tax years, savers could have lost out on £35 per head in tax free interest.

The firm said that this means savers could have lost a potential £23 million per year.

Brendan Cook, chief executive of M&S Money, said: “With an estimated 2million new Cash Isas to be opened in the current tax year, savers could be losing out on a huge amount of tax free interest.”

He urged savers to “take more interest in their savings”, and make full use of their Isa allowance, especially when the allowance increases from April 6th.

Last week, Adrian Lowcock of Bestinvest said that one way to get good value on an Isa was to search for a broker who only took a low rate of commission.

Tags: tax, value, ISAs, individual savings accounts, April

Boost in saving predicted for 2008

The number of consumers saving money is expected to grow during the course of 2008 “in terms of the proportion of the money in society”, claims one financial expert.

Halifax said that the slow down in the economy is likely to make consumers feel they need to deposit their money into their savings accounts in a bid to save.

Jason Clarke, spokesperson for Halifax, said: “When the economy is growing, people are confident.”

“When things begin to slow down, people think ‘now I need my rainy day money’ – it’s almost the reverse of what it should be. It’s down to [the] human psyche,” he added.

Halifax also advised those consumers looking for a savings account to research their options before committing to a deal.

According to the Buildings Society Association, building societies attracted a record £16.1 billion of savings inflows in 2007, which is almost double the inflow of 2006.

Meanwhile, in December 2007, HBOS forecasted that savings in Individual Savings Accounts (Isas) would rise by £30 billion to £240 billion in 2008.

Tags: individual savings accounts, building, financial expert, psyche, ISAs, hbos, record, confident.""When things

Consumers ‘confused’ by Isas

Over 40 per cent of consumers do not know what the current limit is on their Isa according to research from financial experts.

Findings from the Alliance & Leicester also revealed that almost 80 per cent of do not know what the maximum limit is for equity Isas.

Ewan Edwards, head of savings at Alliance & Leicester, said that the study shows that, with the new rules surrounding Isas arriving in April, many consumers are still confused by the current regulations in place.

“We feel that more could be done to communicate the basic principles and benefits of Isas, so that everyone is clear about how they work and how to get the most out of them,” he added.

The “structure must be more straightforward” if they are to appeal more to the man on the street, he concluded.

According to Moneyfacts.co.uk, changes to Isas from April 6th involve increasing the the annual contribution to £7,200 while the maximum cash element is also set to increase from £3,000 to £3,600.

Tags: edwards, ISA, maximum limit, leicester, equity, ISAs, bank of england

ISA reforms to allow customers to “mix and match”

Proposed government reforms to ISAs will encourage more people to save, financial experts said today.

A director at Tax Incentivised Savings Association (TISA), a trade association representing the financial services industry, added that customers would now be able to “mix and match” their ISAs, under the reforms announced last month.

The government will set new limits for cash ISAs at £3,600 and stocks and shares ISAs at £7,200, effective from next April.

Peter Shipp, technical director of TISA, said: “If [customers] have a cash ISA with the bank or building society and they have a stocks and shares ISA with another firm, they can mix and match as long as they don’t go over £7,200 overall.”

He recommended that savers take out ISAs, as they “encourage…people to save” and that people “will get their interest without a deduction of tax” by using them, unlike ordinary savings accounts which deduct the basic rate.

Stocks and shares ISAs were also a good way of avoiding capital gains tax if shares go up, he added.

Around 18 million Britons currently hold ISAs, with Mr Shipp confirming that latest statistics showed uptake levels at their “highest ever”.

Tags: building, cash, ISAs, ISA, avoiding capital gains, government reforms, government, director