ISA savers in their millions are missing out on extra funds as £43billion in low interest accounts. There are almost five million instant access cash ISA accounts held earning low rates in the UK with an average balance of over £8,500.
Research also completed by Yorkshire Building Society suggests that almost half (45 pe rcent) of Brits stated if they were given £400 with no catches they would save the money. Chris Irwin, director of savings at Yorkshire Building Society, spoke out over the findings.
Mr Irwin said: “It’s surprising to see such a large amount sitting in low paying ISA accounts after a period of significant increases to savings interest in the last two years. This data follows on from our analysis earlier in the year calling for consumers to take time to review their finances.
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“The start of a new financial year gives the perfect opportunity to review finances and make the switch from low paying accounts. Although we’ve seen the Bank rate increase, this analysis clearly shows that there are still many accounts which continue to pay low rates despite those increases.
“It’s important for savers to take action and think about how they can make their hard-earned cash go as far as possible.” Rachel Springall, finance expert at Moneyfacts, said: “This research emphasises why consumers need to regularly check the rate they earn against the market and not presume they are getting a decent return.
“It is wise to make a diary note to proactively review and switch existing ISA pots to keep their tax-free wrapper and chase better returns. Leaving Cash ISAs unchecked or becoming apathetic can be costly, as savers may miss out on a better rate without realising it.”
Opening an ISA on the very the first day of a new tax year means savers accrue tax-free interest on their account from the very earliest point in time.
