Share investors 'planning to use increased allowance'

More than half of all cash investors plan to fully utilise their increased stocks and shares Isa allowance from next year, it has been reported.

A study conducted by The Share Centre indicates that six out of ten Isa savers will be using their full £5,100 tax-free allowance when it becomes available to all age groups in 2010-11.

Consumers will be able to place £10,200 in total across cash and share accounts from April 6th 2010.

Graham Spooner, investment adviser at The Share Centre, said that with savings interest rates relatively low at present, it is "vital" that investors take advantage of the increased allowance and "protect what they can from the taxman".

He commented: "The new stocks and shares Isa limit will mean investors can stash away an additional £3,000 from the taxman.

"While see-sawing markets have left some wary of investing in equities, it is worth bearing in mind that returns from equities have consistently outperformed cash, decade-on-decade over the last century, apart from the 2000s."

The Dunfermline recently launched two Isas, a one-year deal offering a savings interest rate of three per cent and a two-year account offering 3.25 per cent.

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2010-03-18 13:02:55 © Moneyextra.com