Investors undecided about ISAs
Many active investors are either undecided or will not be investing in Individual Savings Accounts (ISAs) before the end of this tax year, according to New Star Investment Funds.
A survey by New Star looked into the attitudes to ISAs coming up to the end of the tax year deadline of 6 April 2008. Of those surveyed, 62% planned to forfeit their ISA allowance this year, with only 38% considering taking out an ISA before 6 April. The reasons for their reluctance included nervousness about the markets and general economy (10%), with 25% claiming they were simply undecided about whether to take out an ISA or not.
Richard Wilson, marketing director at New Star, said: “The opportunity cost to investors over the long term from both a tax and investment perspective could be significant. The survey suggests that the majority of investors may be relinquishing the opportunity to protect up to £7,000 from the clutches of the taxman.”
Wilson added that investors considering an ISA should take note of the fact that over the past 20 years cash has returned 308.5% compared to superior returns of 607.6%, 581.1% and 417.8% from direct UK commercial property, UK equities and bonds respectively.
He continued: “Long-term investors need to ask themselves this: if they look back in 20 years time, will they regret a missed opportunity and past short-term pessimism?
“Above all else, this research highlights the need for investors to seek independent financial advice.”