Two-thirds (66%) of 18-24 year-olds are unaware that the annual ISA allowance will rise to £15,000 in July, according to a survey by Nationwide Building Society.
From the 1 July, the New ISA (NISA) system will allow customers up to £15,000 in tax-free savings and the ability to transfer savings in stocks and shares ISAs to cash ISAs.
However, Nationwide has found that many young people are unaware of the upcoming changes.
Over three-quarters (77%) of 18-24 year-olds didn’t know that equity ISAs can be transferred to cash and 72% didn’t realise that they could save the full annual ISA allowance across both equity ISAs and cash ISAs.
Other key findings:
- 52% of those aged 55 and over were aware of the ISA changes
- 30% knew about the equity-cash transfer rules
- 46% knew that they could save the full allowance across equity and cash ISAs
- 39% of those surveyed had not made any ISA investments so far this year
- 42% had no savings in a cash ISA or an equity ISA.
Richard Napier, divisional director of savings and mortgages at Nationwide, said:
“Some people may be saving but not through an ISA, which means they are losing out by not opting to save tax free. Many others are unaware that they can save in both stocks and shares and cash ISAs, and that the allowance across the two can be spread as customers wish up to £15,000.
“This lack of clear understanding of the options that are now available means that customers could be losing out, when they could be making the most of the greater ISA freedoms that are now available.”