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Five reasons to use your ISA allowance

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The maximum ISA limit is £20,000, which is a lot of money for the average saver. But there are plenty of reasons to use as much of it as possible.

The government increased the ISA allowance to £20,000 in the last tax year, the most generous level since the savings product was launched 20 years ago.

This means you can save or invest up to £20,000 into a cash or stocks and shares ISA and you won’t pay a penny of tax on anything you earn.

Around £69bn was put in adult ISAs in the 2017/18 tax year, an increase of £7.8bn compared to the year before, government figures show. But the average person is saving just £6,409 a year, well below the annual allowance.

While saving £20,000 a year is out of reach for many people, there are good reasons to increase the amount you put in an ISA if you have any spare cash in your bank account.

Here, senior wealth planner at Sanlam UK, Carl Drummond, shares his top five reasons:

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