A leading UK building society has issued an urgent alert to savers following a significant government policy shift on Individual Savings Accounts (ISAs).
Expert Guidance in Wake of Policy Shift
Alex Sitaras, the head of savings and partnership products at Skipton Building Society, has released crucial advice for the public. This comes after the new Labour Party government announced a decision to reduce the annual cash ISA allowance, a move that has sent shockwaves through the savings community.
Sitaras warned that the sharp reduction in the tax-free savings cap means a far greater number of people under the age of 65 will now face paying tax on money that was previously shielded. "Making the right moves now is vital," he emphasised.
Navigating New Savings Landscapes
The expert from Skipton, which offers free financial guidance via its My Money Reviews service, pointed to Stocks and Shares ISAs as a potential alternative for tax-efficient growth. However, he stressed this must align with an individual's long-term financial objectives.
"These changes are a useful nudge for savers to start thinking about investing, yet they won't – and shouldn't – drive decisions on their own," Sitaras commented. He underscored that the most important factor is selecting the right strategy for personal circumstances, which could involve sticking with cash, moving to investments, or opting for a blend of both.
Research conducted by the building society reveals significant public concern. Over half (52%) of savers believe it will be important to seek professional financial advice to navigate the new rules. Furthermore, 41% are likely to look for guidance on how to maximise their returns under the revised system.
Additional findings show that four in ten people would seek advice to prevent costly mistakes that could erode their savings, while 30% want help understanding what the reduced allowance means for their long-term goals.
Addressing Saver Anxiety and Confusion
Alex Sitaras acknowledged the widespread unease, stating: "Today's announcement has understandably rattled a lot of Cash ISA savers, particularly those under 65." He noted that individuals who have diligently built a financial safety net are now uncertain about the implications and whether they need to overhaul their entire savings strategy.
"What we're hearing already is a mix of frustration, confusion and, for some, real concern about making the wrong move," he added. Despite the anxiety, Sitaras reassured savers that numerous smart, tax-efficient options remain available. The critical task is identifying which ones genuinely fit their personal ambitions.
He likened the situation to a sudden change in the rules of a game, urging people to take a step back and reassess their position. "The good news is no one has to figure this out alone," Sitaras concluded, highlighting that Skipton offers expert, regulated financial advice tailored to individual needs, a service available to everyone, not just its existing members.
The message from one of the UK's major financial institutions is clear: proactive planning and seeking informed advice are now essential steps for anyone looking to protect their hard-earned savings from unexpected tax liabilities.
