Isa News Stocks And Shares ISAs Predicted To Shine In 2010

Written by Editorial Team

02 March 2010 / by Andy Davies

Stocks and shares ISAs are “set to impress” investors in the run up to the new ISA allowance being launched, Legal & General has said.

According to the stocks and shares ISA provider, ISA investment in the last quarter of 2009 was “stimulated” by the increase in the over 50 ISA allowance.

In light of this, Legal & General is predicting that the new ISA limit of £10,200 for stocks and shares, which is being rolled out to all eligible savers from 6 April, will “boost interest in ISA investment in 2010”.

In September last year, Legal & General estimated that around one million investors aged over 50 would  top up under the new ISA entitlement, creating additional sales of stocks and shares ISAs of £2.85billion in the 2009/10 tax year.

Commenting, Claire Evans, unit trusts marketing director at Legal & General said: “In 2009, retail investors invested around £2.5 million on average every day in our stocks and shares ISAs. We are expecting to see sales significantly higher than this in the coming months.

“In our experience retail investors tend to use their ISA allowance just before tax year end. We believe many savers have been holding back, possibly waiting to see whether investment markets show further signs of recovery.”

Encouraging investors to consider equities rather than cash, Ms Evans claims that with rising inflation, equity investments have the potential to outperform cash assets over the long-term.

“Savers may be missing out on equity market returns believing that these types of investment are only suitable for those with large sums to invest. However, even modest savers should consider investing in a stocks and shares ISA.

“Regular savers can take advantage of the potential for long-term growth in stocks and shares and benefit from tax savings by sheltering their money from Capital Gains Tax in an ISA,” she said.

© Fair Investment Company Ltd