There are various types of ISAs, but they mainly fall into a cash ISA or a stocks and shares ISA. Both of these are usually accessible whenever you need, and gains are free from Income Tax and Capital Gains Tax, providing a way to invest within an annual limit, so are useful for short to medium financial needs, as well as longer term planning. Lifetime ISAs provide a slightly different approach; anyone aged between 18 and 40 can set one up, and they attract a 25% government bonus on contributions up to £4,000. However if you withdraw the money for a reason other than buying a house, or earlier than age 60, there is a 25% government withdrawal charge.
The main differences between pensions and ISAs is tax relief and when funds can be drawn. Tax relief is only available on pensions (not ISAs) and is an important boost to your retirement savings from the government. This is why it is important to consider utilising both pensions and ISAs as part of a holistic approach to your financial planning needs, so that you don’t miss out on the benefits of both.
The value of an investment 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 the amount invested. A stock and shares ISA will not provide the security of capital associated with a Cash ISA.
The levels and bases of taxation and reliefs from taxation can change at any time and are generally dependent on individual circ*mstances.
Please note that St. James's Place do not provide Lifetime ISA's.
