MONEY MATTERS: Make the most of your yearly ISA allowances

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With interest-rates being held at historical lows, savers, particularly those who rely on their interest to pay bills, have been hit hard.

With the spiralling costs of food, fuel and utilities, this coming winter has some people worrying.
Most people are now used to looking at tax efficient homes for their money, such as Individual Savings Accounts (ISAs), in an attempt to keep all their interest and not let HMRC have a portion. However, many people are unaware that the cash ISA element they regularly use only represents up to half of their annual ISA allowance.
In this tax year, the cash ISA allowance is £5,640 per person, but our total ISA allowance is £11,280 per person. The lesser known element relates to ‘investment’ or ‘stock and shares’ ISAs. They allow investors access to a huge range of risk-appropriate funds, either for income or capital growth and they provide a tax-efficient wrapper around any gains.
For those with existing ISAs there’s nothing stopping you switching provider for both your cash or investment ISAs. In fact, to make sure you continually get a top rate this will be essential, particularly for your cash ISAs.
Another trap some people fall into is they assume they have to have a lump sum to invest. Most providers now allow monthly contributions into these plans, so your tax-efficient oak trees can start from fairly modest monthly acorns.
We are already over half way through this tax year and the taxman would like nothing more than to keep nibbling away at your hard earned interest, so take stock of the opportunities we have.
Finally, it must be remembered that there are risks involved with certain ISA investments and your capital is not guaranteed in the same way as a cash ISA would be. 
Your investment amount could fall as well as rise and you may not get back as much as you invested. So take advice as to what funds are appropriate for your situation, aspirations and attitude to risk.