76% of over 50s live in cash ISA allowance ignorance
- Three quarters (76%) of over 50s don’t know how much their annual ISA allowance is.
- One third (32%) of savers over 50 wrongly believe they can only save up to £3,600.
- One quarter (22%) of savers over 50 wrongly believe they can only save up to £1,800.
New research by The Co-operative Financial Services (CFS) reveals that when it comes to saving 76% of people aged over 50 don’t know how much their annual Cash ISA allowance is.
The findings confirm that the recent allowance increase for over 50s has further blurred understanding of allowance limits; with savers aged over 50 more confused about their ISA allowance than younger generations. One third (32%) of over 50s wrongly believe they can only save £3,600 and one quarter (22%) believe they can only save up to £1,800, highlighting that the allowance increase has not been fully understood.
The figures also highlight saving behaviours of the over 50s with 18% more likely to have invested in an ISA this year than those under 50, 51% more likely to invest lump sums, and 63% less likely to be regular savers, when compared to the under 50s.
The research also shows that the majority (52%) of those over 50s believe that the recent financial crisis affected their decision regarding the type of ISA they chose last year, which could explain why this tax year saw a higher proportion of Cash ISA applications for over 50s, perhaps highlighting that people’s appetite to risk is lower than in the past.
Rod Bulmer, Managing Director, Retail for The Co-operative Financial Services comments: “The research confirms that although over 50s understand what an ISA is and its multiple benefits, they are not fully aware of the level of ISA allowance. As a trusted financial service provider it is extremely important for us to ensure customers are aware of the current ISA limit so they can gain the benefits from their full tax free allowance.”
“We have a wide selection of straight forward Cash ISAs to suit all ages and we recognise that although people have different attitudes to savings, it is important that they are able to understand the different products and choose the one that fits their requirements”.
For further information please contact
Alejandra Solis / Jayne Dono
The Co-operative Financial Services Press Office
Tel: 0161 903 3808 / 0153 839 3883
Email : email@example.com / firstname.lastname@example.org
Notes to editors:
*Research carried out in February 2010 by ICM research on behalf of The Co-operative Financial Services Savings amongst a geographically representative sample of 2,057 adult respondents.
*Cash ISAs from The Co-operative Financial Services are as follows:
(Co-operative Bank only)
|0.5% with unlimited withdraws. Minimum deposit of £1.|
|Limited Access Cash ISA
|2% with one withdrawal allowed; otherwise rate falls to 0.5%. Minimum deposit of £500.|
|Easy Monthly Saving Cash ISA
|2.1%. 12 equal monthly payments must be made of between £20 to £300 per month (£425 for over 50s). Needs to be made by direct debit, internal transfer or standing order. Only one withdraw allowed, otherwise rate falls to 3%|
|Fixed Rate (Available at both The Co-operative Bank and Britannia’s branches)
||Minimum deposit of £5,100. If fixed for a year 3%, if fixed for 2 years 3.4%. Available from the 2nd March 2010.|
For more information on The Co-operative Financial Service’s Cash ISAs visit:
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About The Co-operative Financial Services
The Co-operative Financial Services (CFS) is part of The Co-operative Group, which is the world’s largest consumer co-operative with around five million members, over £14 billion turnover, and core business interests in financial services, food, travel, pharmacy and funeral care. The Co-operative Group has over 5,000 retail trading outlets.
Following the merger with Britannia Building Society on 1 August 2009 CFS is one of the largest and well diversified mutual businesses operating in both retail and corporate markets.
As part of The Co-operative Group, the new business is characterised by its unique ethical and member reward policies and very high levels of customer advocacy.
The combined business has £70 billion in assets, 12,000 staff and nine million customers. It has over 300 high street branches, 20 corporate banking centres and a major presence in Manchester, London, Leek, Bristol, Plymouth, Skelmersdale and Stockport.
It is the only mutual organisation that enables its members to earn financial rewards for the products they hold, as well as giving them the opportunity to have a say in how the business is run.