Want to invest in a Cash ISA?

ISA’s explained

Cash ISA is similar to a traditional savings account and is ideal for short term investing. It allows you to build up your cash savings and earn tax-free interest on your money.

Watch our short video explaining how Cash ISAs and Stocks & Shares ISAs differ.

A Cash ISA may be suitable for you if

  • You are saving for the short term (less than 5 years) for example, a holiday or a car.
  • You do not want to take investment risk with the money you’ve saved.
  • You want easy access to your savings.
  • You want to benefit from interest paid tax-free and tax free income/withdrawals.

Risks of a Cash ISA

  • Some Cash ISAs are instant access while others have fixed terms of up to 5 years.  This means you could be penalised if you withdraw your money early.
  • Over time, inflation will reduce the buying power of money.  For example, if inflation is 2.5%, then in 20 years’ time, £10,000 will only buy the same as £6,100 buys today.
  • Charges may apply and could increase in the future.
  • The interest rate is often variable and may go down.

Cash ISAs versus Stocks & Shares ISAs

See how they compare

If you invest £5,000 into an ISA today, here’s a projection of how it could perform over both 5 and 10 years in a Cash ISA and a Stocks & Shares ISA.

  Cash ISA Stocks & Shares ISA
Amount invested £5,000 £5,000
Growth rate p.a. 1% 5%
Charges p.a. 0% 1.23%
Projected amount in 5 years* £5,250 £6,010
Projected amount in 10 years* £5,520 £7, 230
*Projected fund values rounded down to 3 significant figures

With investment comes risk. The value of an investment can go down as well as up and you may not get back the full amount invested. Investments should only be considered for long term goals (5+ goals).

Zurich FutureYou doesn’t offer a Cash ISA but can search for Cash ISAs on many of the financial comparison sites. Alternatively, you can speak to a Financial Adviser in your area by going to www.unbiased.co.uk (we are not responsible for the content of other websites).