Press release


Monday 12 March 2012

• 68% of over 50s say they should be able to hold full £10,680 limit in cash
• Over 50s stand to gain over £370 million in extra tax free interest*

New research by Saga** shows that there is significant support for a change in ISA rules.

Cash ISAs are universally popular amongst the over 50s, with 76% holding an account.  And Saga’s survey of 10,862 people over 50 indicates that Cash ISAs are not just the preserve of the very wealthy.  Two thirds of the least-wealthy social groups (DE) have a cash ISA account - rising to 78% for ABs. They are also more popular as you get older - with the numbers holding a Cash ISA increasing from 66% of a those aged 50-54 to 78% of those aged 70 -74.

The survey evidence suggests that older people have made the most of each year’s tax free allowance, with almost one in ten (9%) saying they now have between £50,000- £100,000 of cash ISA savings, although typically they hold somewhere between £10,000 – £20,000.

More than two fifths (44%) of respondents said that they were intending to use their maximum ISA allowance this year, with a further fifth (21%) unsure as to what they would do.  This indicates that the over 50s could have a lot more to invest were they able to do so.

In fact when asked whether they think ISA rules should be changed so they could hold the entire £10,680 ISA limit in cash if they wish to, there was huge support amongst the 10,000 people Saga surveyed.  Two thirds (65%) agreed that this was a good idea.

Ros Altmann, Director-General, Saga commented: “Typically as we get older we like to hold more of our investments in cash and live off the interest earned.The way the current ISA system works is unfair to older savers as they can only benefit from half the full ISA allowance each year.As savings rates have remained so low for so long, we call on the Government to change the ISA rules to help older savers receive more of their savings income tax free.  These people have already been punished enough by the effect of Government policy on their savings income, and while interest rates remain so depressed and inflation rates remain high, it is only fair that older savers should have the flexibility to use the full annual ISA allowance for their cash savings if they need to.”

‘Saga is trying to ensure that our own business is doing whatever it can to minimise the impact of low interest rates, to help the over 50s.  Our fixed rate ISA offers one of the best rates in the market.”



Notes to editors:

*Calculated as follows:A 40% tax payer investing £5,340 into the Saga ISA Saver paying 2.7% would be £56.07 better off a year than if they invested £5,340 into the Internet Saver, paying 2.75%. Internet Saver would earn £88.11 net interest, ISA Saver would earn £144.18 gross multiplied by the number of over 50s using their full cash ISA allowance each year. This is calculated as follows:
There are 21million over 50s – of which 76% have a cash ISA = 15960000, 44% of these plan to use their maximum allowance this year = 7022400 x £56.07 = £372,678,768.

**Saga Populus poll interviewed 10,862 Saga customers, all aged 50+, online between 20th February and 27th February 2012. Populus is a member of the British Polling Council and abides by its rules; for more information see

Do you have any cash ISA accounts? 




  Male  Female  50-54  55-59  60-64 65-69 70-74 75 and over 
 Yes  74% 75%  66%  70%  77% 80% 78% 74% 
 No  26%  21%  34%  30% 23% 20% 22%  26%


Current limits for the ISA allowance means that you can only save half of the £10,680 allowance in a cash ISA and the rest in stocks and shares or you can invest the entire £10,680 in stocks and shares.  To what extent do you agree or disagree that ISA allowances should be changed so that you  can invest the entire £10,680 in a cash or shares ISA as you choose?



  Male  Female  50-54  55-59  60-64  65-69 70-74 75 and over
 Strongly agree 47%   41%  43%  46%  50% 46% 41% 35%
 Slightly agree  19%  20%  18%  19%  19% 20% 20% 21%
Neither agree nor disagree  22%  24%  23%  22%  21% 22% 28% 27%
Slightly disagree  2%  1%  3%  1%  2% 1% 2% 3%
Strongly disagree 1% 1% 1% 1% 1% 1% 1% 1%

ISA’s available through Saga

Saga fixed rate ISA 3.7% Tax free AER
The Saga Fixed Rate ISA, provided by Birmingham Midshires, is available now for cash ISA deposits for the 2011/12 tax year.
• An attractive tax free return over a 3 year term
• Deposit from £1 up to £5,340 for the 2011/12 tax year
• Transfer some or all of previous years subscriptions or all of current tax year subscription into the Fixed Rate ISA, providing the issue remains open.
• Choice of yearly or monthly interest
• Withdrawals are allowed subject to a charge. The charge will depend on the length of term remaining at this time of access and is the equivalent of a number of days tax free interest on the amount withdrawal.

Saga ISA Saver2.7% Tax free AER
The Saga ISA Saver (Issue 3), provided by Birmingham Midshires, is available now for cash ISA deposits for the 2011/12 tax year.
• Variable interest rate of 2.70% tax free/AER.
• Includes a bonus of 1.10% for the first 18 months if yearly interest is chosen
• Deposit money tax free
• Deposit any sum from £500 up to £5,340 for the 2011/12 tax year
• Transfer some or all of previous years subscriptions or all of current tax year subscriptions
• Unlimited access to money with no notice withdrawals
• Choose yearly or monthly interest