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UK chancellor Rachel Reeves announced during the autumn budget that the government would cut the cash ISA limit from £20,000 to £12,000 for most people, beginning in April 2027.
Reeves hopes the move will encourage more Britons to start investing in the stock market. However, many commentators and experts have their doubts about whether her plan will actually yield the intended results.
Sarah Coles, head of personal finance at Hargreaves Lansdown and Yahoo Finance UK columnist, said: “We need an investment culture in the UK, and some of the money that has been saved in cash ISAs would work harder for people if it was invested instead, but there’s no evidence that cutting the cash ISA allowance would encourage them to make the change.”
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These insights tally with some recent studies focused on UK investment trends. For example, pre-budget research from personal finance comparison site Finder, found that only 35% of people said they would invest their money if the tax-free limit on cash ISAs was cut and they had additional savings to put elsewhere.
Questions have also previously been raised about the level of knowledge Britons have about investing and whether the FTSE (^FTSE) is even still a good place to invest.
We’d like to hear from you on whether the shakeup to ISA rules would encourage you to start investing in the stock market? Vote in our poll below.
Yahoo Finance UK’s poll of the week lets you vote and indicate your strength of feeling on one of the week’s hot topics. After the poll closes, we’ll publish and analyse the results each Friday, giving readers the chance to see how polarising a topic has become and if their view chimes with other Yahoo UK readers.
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