Fundamental principles of an ISA
The government first introduced ISAs, or Individual Savings Accounts, just before the turn of the millennium in 1999. Launched by Gordon Brown to encourage more people to save for the future, ISAs have grown to become one of the UK’s most popular savings products.
Despite this, they were initially labelled a “colossal failure” by Labour MP Quentin Davies just months after they launched due to the slow rate of uptake. However, they’ve since become an essential part of saving for the British public.
A primary goal of the ISA was to simplify the process of using savings products. ISAs replaced the Personal Equity Plan (PEP) and Tax-Exempt Special Savings Account (TESSA). Throughout the development of ISAs, successive governments have tweaked and redesigned different aspects of them, including the addition of new products and amended limits.
The changes mean that choosing the right ISA product for you while understanding how to make the most of your allowance isn’t as straightforward as it was previously.
Read on to find out what you need to know about ISAs.
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