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Over-55s the experts with stocks and shares ISAs

Those aged 55 and over are most likely take the lead with stocks and shares ISAs, according to research from Standard Life. 

The investment specialist claims 11% of 55-and-overs invest in the stock market through an ISA compared with just 7% of 35- to 44-year-olds.

Standard Life spokesperson Julie Russell commented: “With the MPC [Monetary Policy Committee] keeping interest rates low and inflation relatively high, cash held in an ISA or a savings account is often being eroded in real terms.

“So, with the arrival of the new tax year and new ISA limits, it might be worth reviewing your approach, to see if you can take more risk with some of your cash.

“You could potentially invest in the stock market instead, through a tax-efficient stocks and shares ISA, to try to beat inflation. However, it’s always sensible to keep some money in cash, where it is safe and you can get instant access to it. 

Around 9% of Brits currently invest in stocks and shares ISAs, and 6% plan to save more in a stocks and shares ISA this year than they did in the last tax year.

The research also reveals that men and women take a very different approach to their investments. Around 12% of men currently use a stocks and shares ISA, compared with just 6% women. An equal percentage of men and women currently use a cash ISAs (41%).

Ms Russell added: “Those who are willing to take more risk with some of their money should possibly consider using as much of the annual £11,520 stocks and shares ISA allowance as they can this new tax year.

“But they may still feel they don’t know enough about the stock market and be wary about taking too much risk. Diversifying the investment portfolio remains key to managing ISA risk, which is why risk managed funds are proving so popular.

“These funds are designed to make it easier for investors to gain exposure to a diversified investment portfolio that aims to maximise potential returns, in line with the level of risk an investor is willing to take. 

“They match an investor’s appetite for risk with a portfolio of investments in a wide range of underlying assets.”

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