Savings & Investments

If you have cash in various accounts , you will find it increasing difficult to find a decent interest rate in the current environment.

ISAs can be the most tax efficient, but ordinary deposit accounts with Building Societies and Banks can offer higher rates of interest than Cash ISAs, outweighing the tax advantages of tax free interest.
As we can now earn £1 000 a year in interest tax free , however for higher rate taxpayers this is only £500. But it is still good tohave and use.

For longer term investing, five years and longer, then stocks and shares ISAs are recommended, if you can handle some volatility in the short term.
ISAs invested in funds or direct shares can provide tax free gains and a tax friendly (not quite tax free) income.
This is most useful in later years when you are looking to maximise income in retirement without paying too much income tax.
Investing for income is a key component in retirement and ISAs make your money work harder for you.


There is risk in having cash in the what appears a safe bank and building society account. It is interest rate risk and inflation risk.

Yes – your capital may be safe but the benefit you are receiving may not always be the highest rate. Moreover inflation is your worst enemy on deposit. Most interest or even ‘High’ Interest accounts cannot keep pace with the cost of living.

If you have more cash in the bank than you need for everyday needs and some for emergencies then taking some level of risk into stocks and shares may be alternative. Contact us if you want advice.


Trying to squeeze the best interest rate for savers is always a big test and the best way to ensure you are getting a good rate is to review annually.

Moreover always use up your ISA allowance. For this year it is £15,240. Also, new rules mean you can switch from stocks and shares to cash and back again without losing the tax friendly status of the plan.

ISA should be your first stop for a tax payer as your money should grow more efficiently. An ISA is simply a savings wrapper that can make a savings account or investment plan more tax efficient. Isas are tax-efficient savings vehicles, but don’t make the mistake of thinking they are completely tax-free.

For Cash ISAs unlike ordinary cash savings accounts, savers don’t pay income tax on the interest.

Stocks and share ISAs funds aren’t entirely tax-free, because share dividends will automatically have 10pc income tax deducted which can’t be reclaimed. Higher-rate taxpayers don’t have any further tax to pay on dividends, whether from direct shareholdings or funds.

No income tax is due. And more significantly, there is no Capital Gains Tax (CGT). This allows investors to build up substantial Isa portfolios without further tax implications or needing to list their holdings on a tax return.