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Investors are looking to ISA investments as a primary alternative to pensions. Here, Lee Goggin, Co-Founder of, examines why.

In the three months to end-September, we saw ISA-related wealth manager enquiries surge by a third, indicating that the UK’s affluent investors are getting proactive on maximising their ISA usage well ahead of time this tax year. Currently, 39% of the affluent individuals coming to are seeking professional help with a ISA investments.

ISAs have always been a great way to invest tax-efficiently, but the enhancements being made to these accounts have seen them become a more important part of wealth management arsenal than ever.


ISA, ISA Investments, Pension, Tax-Effecient
Source: monevator

Because of the portion you can save from not paying taxes at all by investing in ISAs instead of your pension. Currently, if your pension grows above £1m, the tax payable when funds are subsequently withdrawn is a hefty 55%. As a result, many are looking to ISAs as an alternative tax-efficient pension savings route.

Free money? Yes please.

But it’s certainly not all about pension pots. ISA investments provide the freedom to move in and out of cash or stocks and shares, which certainly have piqued investors’ interest. Couple that with the fact that ISAs can now effectively be passed on death to a surviving spouse or civil partner, it is little wonder that a recent MetLife study of financial advisers revealed that 42% believe ISA investments are going to be the most important retirement planning product of all going forward.

As part of the government’s moves to encourage saving and investment, further innovations are coming too. One in particular which was recently announced will really increase the importance of these accounts to affluent individuals in the UK in our view. The bulk of investors’ earnings from peer-to-peer lending will be tax-free as part of further ISA freedoms coming in next year – something which might prove a real game-changer given the growing popularity of this type of investment.

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