EasyMoney: Decline in young people using ISAs is a ‘real concern’
THE NUMBER of young people putting money into ISAs has fallen by more than a third over the past five years, according to research compiled by EasyMoney, part of Sir Stelios-Haji-Ioannou’s easy family of brands.
The peer-to-peer lending platform, which recently launched with an Innovative Finance ISA (IFISA), cited HMRC data that showed 1.2 million under-25s held ISAs in the 2014/15 tax year. This is down from 1.9 million in 2009/10.
While the figures appear to be for all types of ISAs, the property lender suggested that the decline may be due to younger people shunning cash products that offer negligible returns in a low-interest-rate environment.
“This collapse in numbers of young people saving into ISAs is a real concern,” said Andrew de Candole, chief executive of EasyMoney.
Read more: Savers facing ‘daylight robbery’ with cash ISA rates
“All savers – but the younger generation in particular – have been questioning the value of ISAs. Recent performance of cash ISAs especially is not exactly a strong selling point. However, they should not be too quick to dismiss all types of ISAs out of hand.
“IFISAs are an important step forward in making ISAs attractive and relevant to young people.
“Our view is that many investors are prepared to accept a sensible increase in risk for returns that outstrip inflation.”
Read more: 2,000 IFISAs subscribed last year as consumers eschew low-yielding cash ISAs
EasyMoney offers people the opportunity to invest in multiple property-backed P2P loans for a target return of 4.05 per cent.
The company acquired the business of specialist short-term property lender Tower Bridging and makes loans to property professionals secured by a first legal charge over UK property.
