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5 Benefits of ISA Planning

Investing in an Individual Savings Account is integral to any financial plan because it offers a tax-efficient investment opportunity. However, utilising your ISA isn’t as simple as putting money into that account. With a specified allowance, there are many benefits of ISA planning to ensure you get the most out of this strategy.

The team at Lester Brunt are passionate about educating everyone on the benefits of planning how you use your ISA and providing a professional service to assist with this.

Benefit 1: Tax Efficiency

Most investment opportunities have some form of tax attached to them. However, investing in an ISA presents a tax-efficient investment opportunity.

Utilising your ISA allowance means you can invest a certain amount without incurring income, capital gains, or dividend tax on any returns you make.

Making ISA planning part of your investment planning strategy can help ensure that you allocate the right amount of funds into this pot, allowing you to utilise this tax-efficient investment.

Benefit 2: Maximising Returns

Whether you are investing in a standard Adult ISA, a Junior ISA or a Lifetime ISA (LISA), there is a predetermined allowance for the amount you can invest in a single tax year.

The allowances for each account are as follows:

  • Adult ISA – £20,000
  • Junior ISA – £9,000
  • LISA – £4,000

ISA planning will ensure that you are allocating the maximum amount of money to a strategy that will assist you with achieving your goals, be it retirement, buying a first home, or saving up for a family holiday.

There are also various types of ISAs that will offer different returns.

Cash ISAs will simply hold your balance in an account which pays interest, whereas a Stocks and Shares ISA will invest your money into a range of stocks and shares giving you the potential to achieve more growth. Alternatively, you could have an Innovative Finance ISA where an investor is matched up with a borrower for peer-to-peer lending.

With a range of ISA types and varying levels of risk, planning which ISA(s) you use will help you generate returns that align with your goals while reducing the tax you pay on your investment and ensuring that your strategy is in line with your risk tolerance.

Benefit 3: Flexibility

ISAs are a flexible investment, with many offering the ability to withdraw or move money from the account at any time. This means that, unlike other investment types, this strategy doesn’t have to be long-term, and money can be moved to suit you.

Often, you will be able to take advantage of this flexibility without impacting your annual allowance. However, ISA planning will ensure you utilise this flexibility (if needed) appropriately. With the ability to choose to invest in a diverse range of assets and switch between different types of ISAs.  ISA planning can provide greater control over your financial portfolio.

Benefit 4: Long-Term Wealth Building

Despite the flexibility, ISAs are a great way to build up wealth in the long term, which is why they are a popular way to help achieve your financial goals.

But, ISA planning is important for this, especially if you utilise the flexibility of these accounts because planning will ensure that you leverage each ISA allowance and make informed decisions on how to divide funds, which will impact the build-up of wealth and your financial security.

ISA planning will keep your goal at the forefront of your mind, keeping you on track to reach the objectives set.

Benefit 5: Protection

As mentioned above, the different types of ISAs have various levels of risk with them. However, with the correct advice around ISA planning, we will help you invest in an ISA that matches the level of risk that you are comfortable with, making sure you are protecting your money in an appropriate way for your goals, all the while optimising the potential for growth. 

Early ISA Planning with Professionals

At Lester Brunt, we aim to help you make the most out of the investment opportunities available. With an expert understanding of ISAs and their regulations, we work with you to create a plan that will align with your risk profile and set you up towards achieving your financial goals.

With over 25 years in the industry, we have gained experience helping people achieve financial independence, save for their first home or even start their own business with a range of investment and ISA strategies. No dream is too big, small, simple or complicated.

As a family-run business, we understand how important a secure financial plan is, which is why we won’t just get to know your finances but will get to know you and your family. This way, we can be confident that we are doing what is right for you and your situation.

If you are investing in an ISA and would like help creating a plan and strategy or have any questions about your account, don’t hesitate to get in touch with our experts.

Book a no-obligation consultation online or call us on 01202 695 801.

The value of an ISA with St. James’s Place will be directly linked to the performance of the funds selected and may fall as well as rise. You may get back less than you invested. An investment in a Stocks and Shares ISA will not provide the same security of capital associated with a Cash ISA.

The favourable tax treatment of ISAs may not be maintained in the future and is subject to changes in legislation.
Innovative Finance ISAs, Cash ISAs and Lifetime ISAs are not available through St. James’s Place.

Written By Sam Wade

Financial Adviser

Lester Brunt Wealth Management

Lester Brunt Wealth Management is a trading name of Lester Brunt Wealth Management Ltd

SJP Approved 16/04/2024