4 ISA Mistakes Everyone is Making

These are the mistakes people commonly make with their ISAs (Individual Savings Accounts). Making these mistakes could limit the returns you earn, so it's important to understand them. Specifically, I cover:

- Tax benefits of ISAs
- Why ISAs are tax wrappers
- Cash ISAs and Stocks and Shares ISAs
- Personal savings allowance
- Gender investing gap
- Investing in stocks
- Investing for your kids
- Compounding returns
- How to open an ISA
- Retirement funds

TIMESTAMPS:
00:00 - Intro
00:27 - Cash ISA
03:35 - Kids ISA allowance
04:45 - Delaying
07:45 - Withdrawals

WHO AM I:
I'm Kiran, a qualified Accountant and experienced tax professional living in the UK. I make videos about finance, tax and investing.

MY FILMING GEAR:

DISCLAIMER:
This content, and the ideas presented in it, are for education and entertainment purposes only. Kiran does not provide tax or investment advice. The information presented does not consider the financial circumstances of any investor, and therefore may not be suitable for all investors.
Although Kiran is an Accountant, no Accountant-Client relationship is established with the viewer in any way.

As an Amazon Associate I earn from qualifying purchases. The product links in the description are affiliate links. This means if you choose to buy something through one of these links, I may receive a commission on the sale, but it makes no difference to you as a buyer.

[NotyourBusiness-urto]

I’m a god of devaluation, I buy it and it goes down! Why I can't make earnings is beyond me. It can be annoying how volatile the market is. How can I ride this fresh wave of all-time highs without getting burned again with $450k set aside to get fully invested this year?

[Madridstrat]

I have about 250k distributed across various investing accounts, with 35% of my capital invested in an ISA and 25% in index funds. In Q4, 2023, I suffered a great deal. I'm just searching for methods to get better in 2024 right now.

[pauldouse]

Whilst this is headline good advice, there is absolutely no mention of the reasonably high possibility that, in the next few years there will be a crash and your ISA will, temporarily, be hugely devalued. How if you need the funds at that exact moment. This is crucial advice and should always be presented when proposing investing in markets

[well-blazeredman]

I think that cash is the right place to be right now. And Warren Buffet agrees with me. I pay tax at 40% but, through 'rate-tarting', am beating inflation by a clear 1% - so I'm growing my wealth.
I'll put my cash into stocks when the market crashes.
Good video.

[imapadlock]

You didn’t even mention that with a stocks and shares isa your capital is at risk. If you are going to recommend them, people should know.

[jeh]

At 74, I only invest in cash ISAs. I am already paying a huge amount of tax on savings interest.
I put £20, 000 into a cash ISA each year.

[carguyuk]

I pay mostly into my pension as it's very tax efficient, and investment options are easier to access. You can invest 60k per year into your pension while ISA is 20k. If you dont need the money then push money into your pension.

[MartynCooper-vvdk]

Not many stocks and shares ISAs out there to choose from, I think its telling us that folk don't trust those who deal in Stocks and shares on their behalf, they still have the stigma of being robbers and cheats! that if we as investors are going to invest, we need to trust!

[bigboldbicycle]

Good basic ideas, but I really don't like that you picked extreme numbers to try to illustrate your cases. You mentioned people with less than £25k savings probably won't have to pay tax, but then go on to use £9k a year of contributions into a Junior ISA for 18 years. Both are extreme examples that are just not going to apply to the same people. Aaaannyway, how did I come to this video? I was looking at basque cheesecake recipes. Hmm.

[AR-fyqo]

I met a guy who worked in the city. He was 43. Died 3 months later. Don't lose today in the noise of what if.

[AR-fyqo]

What you "can make" could make might make might not make.

[basicsurfer]

super helpful video as always thank you

[amar]

can you make a video going over the two types of stocks and shares isa from vangaurd? Managed vs do it yourself?

[bbsaid]

Any thoughts on investing in gold? It has gone up 26% in 12 months.

[KharmaComa]

I'd say the biggest mistake is not maximising your sipp/pension contributions first. You can contribute up to £60k a year as a tax deductible every year. ISA's dont have this advantage. My approach is to max SIPP first then do ISA as my logic is that I need to at least work towards a realistic annual income off my pension before thinking about tax free cash from ISA's. Having tax free ISA cash at a low level of income is pointless if your income is not at a reasonable taxable income to start with to take advantage of these benefits.

[MorkusSalasevicius]

Thank you for spreading financial literacy and making it digestible to all!

[mustafamar]

People who listen and follow the advice will benefit. Thank you.

[zorabright]

Very good information. I did not put 20K in my ISA per year for 5 years. which is 100K Can I back log and put the money now in my ISA account.
Any help will be highly appreciated. I move to UK 10 years ago so did not know all the rules and my accountant did not guide me.

[nickgreen]

Irresponsible bias for stocks & shares.

[iheardyoulikeme]

So if I leave my money in my ISA, how do you recommend I pay for my home renovation 😮??