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Tax-free investments at-a-glance – they could have made you a millionaire!

Simon Read

Isa story 300x225 Tax free investments at a glance   they could have made you a millionaire!I’m not one for infographics normally but I like this one from the Wealth Management Association which summarises at-a-glance the history of tax-free investments since personal equity plans were first launched by Margaret Thatcher’s government back in the 80s. Does it serve any useful purpose? Not much, apart from a reminder of how much things have moved on and the fact that I’ve been writing about these tax-free wrappers for more than a quarter of a century!

Back then you could only stash away £2,400 in a tax-free account – and only if you invested in shares. That was part of Thatcher’s fairly successful attempt to turn us all into shareholders. Now you can put up to £11,520 in an individual savings account, and there are two types, which a cash Isa running alongside the original stocks and shares one.

Interestingly, if you’d used your allowance every year since 1987 and invested in the right fund, you’d be sitting on more than a million now. You would have stashed away £203,760 – not including the current 2013-14 tax year – but if you’d put it all into the Fidelity Special Situations fund, your nest egg would have grown to £1,542,000. That would have been a profit of £1,338,240.

If only it were that easy to make profits!

Click on the infographic to see the full detail…

ISA Infographic 1024x723 Tax free investments at a glance   they could have made you a millionaire!

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  • Bob Bell in hell

    What you’re forgetting, or possibly choosing not to mention, is that transaction fees and dividend tax would have consumed all those gains on any investment under £20k.

  • geofff_s

    This should be thought of not as tax-free investments, but as tax-payer subsidised savings.

    What point is there of tax-payers’ money being taken to pay people with over £1M in savings?

    We must urgently set a maximum limit to this subsidy & divert the savings to encourage poorer peoples’ savings.

    Once someone reaches £1M, taxpayers have to cough-up over £8k every year in order to subsidise them & worryingly, that lost tax both grows & compounds itself every year.

    The only point of state subsidised savings should be to protect our welfare state from later claims from the elderly without enough savings.


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