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ISAs Remain a Mystery for Over 7 in 10 Gen Zers: Greater Awareness and Education Needed

During a tough economic climate, many Brits are looking at ways they can invest money for the future and protect their finances. One way this can be achieved is by utilising ISAs (individual savings accounts). However, research from the personal finance website has revealed many are missing out on its benefits due to a lack of awareness.

In fact, the research found that nearly half (47 per cent) of Brits are unaware that an ISA provides tax-free savings and investing opportunities. Furthermore, one in 10 (12 per cent) haven’t even heard of an ISA.

The research found that generally speaking, older generations were more aware of the savings accounts’ use cases rather than their younger counterparts. Sixty-three per cent of those aged 43 and over admitted to knowing about ISAs and their benefits. Meanwhile, only 29 per cent of Gen Zers knew about the accounts. Additionally, over a quarter (28 per cent) of the younger generation haven’t heard about ISAs.

Millennials are slightly more familiar with ISAs with 58 per cent not knowing the benefits of investing in an ISA. This was 13 per cent less than Gen Zers (71 per cent).

However, one in six (16 per cent ) millennials do not know what an ISA is either.

While the older generations have heard of ISAs, nearly one in three (30 per cent) are unsure of the benefits of investing or saving with an ISA.

Meanwhile, only eight per cent have not heard of ISAs before, nearly four times less than Gen Z. The number of people that do not know about ISAs decreases by generation in this age group, with 11 per cent of Gen X, seven per cent of baby boomers and three per cent of the silent generation. This could be due to the fact that older generations are more likely to have money aside for saving or investing and thus have done more research on the best ways to do so.

A lack of knowledge is resulting in a loss of funds
George Sweeney, DipFA , Diploma for Financial Advisers
George Sweeney, DipFA, investing expert at

George Sweeney DipFA, investing expert at, comments: “The results of this study show that one in 10 Brits could be losing money on their savings and investments due to a lack of knowledge about what an ISA is and how they work. Any profit made by investing or saving can be taxed by the government, but an ISA can be used to shield these gains.

“The ISA allowance for the 2024/25 tax year is £20,000, meaning you can put anything up to this amount in a stocks and shares ISA, cash ISA or other type. Brits can split their allowance across ISA types, although they can only put up to £4,000 a year in a lifetime ISA.

“A stocks and shares ISA walks and talks like a regular investment account, but it’s what’s known as a ‘tax wrapper’. Similar to a pension, it has its own tax rules. Pretty much all investments in this wrapper aren’t subject to any tax. And, when withdrawing money, it doesn’t count towards someone’s income tax (unlike a pension).

“If you prefer to save, a cash ISA allows you to earn tax-free interest on your savings pot. In the UK, most people can earn up to £1,000 in interest without paying tax, but anything over that will be taxed – unless it’s in an ISA.

“Setting up an ISA is usually dead simple. Typically, a standard account needs to be opened with a trading platform or bank. You can also transfer money from previous years’ ISAs without it counting towards your £20,000 allowance. Just make sure this is done by request through the bank or investing platform rather than withdrawing the money yourself so it doesn’t lose its tax-free status.”


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