ISA Rates

Delaying deposits into a mini cash isa until April 2009 could collectively cost Brits a staggeing £4.3bn in lost interest. This claim has been made by Abbey Saving and is based on the fact that there are around 12 million ISA savers in the UK.

If each of those people delays paying into their 2008/2009 ISA until the tax year is almost up they will on miss out on up to £360 each totalling £4,320 million in lost interest payments.

Reza Attar-Zadeh, Director of Savings & Investments, had these comments on the findings: "Mini Cash ISA rates are better than they have ever been, and the annual limit has just increased to £3,600. Many people leave saving in a Mini cash ISA to the end of tax year. However, people that leave saving in an ISA to the last minute face losing a significant amount of interest throughout the year. Additionally, the competitive deals that are currently available may not be available next year."

He went on to say "It is important to remember that people can use their £3,600 tax-free ISA allowance at any time, not just at the tax-year end."

The fact that so many people leave things to the last minute might indicate a lack of understanding as to what an ISA is but there is more than one way to save in an ISA; some put a lump sum in when they can while some put regular amounts in. Just bear in mind that if you withdraw any funds from an ISA you cannot put that money back in.