Over-50s unaware of ISA changes

Older savers are being kept in the dark as to how much they will be able to invest tax-free when the ISA limit increases for over-50s next month.

Research by Saga found just one in twenty of over-50s know what the new ISA limits will be.

More than half of those polled were oblivious to any changes happening at all.

Saga said its research demonstrates that the government and financial providers “need to do more to advise people of the increase”.

The ISA limit is increasing from £7,200 to £10,200 for over-50s from 6 October.

Half of the new limit, £5,100, can be saved in a cash ISA, and half can be invested in a stocks and shares ISA.

“ISAs are a vital savings vehicle, but clearly more needs to be done to ensure people make the most of the benefits available,” said Andrew Goodsell, Saga Group chief executive.

“We urge the over 50s to take a closer look at their savings and investments and to research the ISAs available to them, especially when the limits are increased on 6th October 2009.”

Saga, which specialises in financial products for the over-50s, recently launched a new two-year fixed-rate cash ISA paying interest at 3%.

Savers transferring over £30,000 from their previous ISA balance will be paid interest at 3.85%.

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