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Peer2Peer Finance News | October 21, 2017

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Half of over 50s unaware they can open an IFISA

Half of over 50s unaware they can open an IFISA
Marc Shoffman

HALF of over 50s have no idea they can open an Innovative Finance ISA (IFISA), research by Saga Investment Services has claimed.

The financial services provider to the older generation says people aged over 50 find the ISA system and the different types of tax-free products too complex.

The poll of 9,998 people of 50 or over found 51 per cent were unaware they could invest in the product.

Read more: Five million over 50s set to open an ISA in 2017

Just 14 per cent of over 50s knew that cash ISAs were available to people over 16, with one in five saying they didn’t know who could open one.

While a third of people knew that an investment ISA was available only to over 18s, a quarter were unaware who could open one.

Only eight per cent realised that the new lifetime ISA is only available to people under 40, and just 14 per cent knew that children can only hold one junior ISA account with one provider at a time.

Half of over 50s were not aware that it is possible to transfer cash ISAs into investment ISAs and vice-versa. Another half were not aware of the requirement to transfer between ISA providers – rather than closing and reopening a new one – to preserve the tax-free status of their income.

Read more: Over 50s mull investments due to base rate cut

“So many changes have been made to the ISA system over recent years that people are struggling to understand the rules,” said Nici Audhlam-Gardiner, managing director of Saga Investment Services.

“Britain needs savers of all ages and keeping things simple is the best way to encourage understanding and action. We are in danger of every good idea resulting in a new type of savings plan.”

Read more: 23 firms now approved to offer IFISAs