Budget 2025: “Cutting the cash ISA is a milestone towards creating a nation of investors”
The AIC responds to the Chancellor’s budget statement.
The Association of Investment Companies (AIC) has commented on the reduction of the annual cash ISA limit from £20,000 to £12,000 announced in today’s Budget, along with an exemption for those over 65 who will be able to continue to save up to £20,000 in cash ISAs.
Cutting the cash ISA limit is a milestone towards creating a nation of investors. Combined with the planned advertising campaign, changes to risk warnings and the FCA’s targeted support initiative, it will all help people make better long-term investment decisions.
Richard Stone, Chief Executive of the Association of Investment Companies (AIC)
Richard Stone, Chief Executive of the Association of Investment Companies (AIC), said: “This is a carefully considered solution that promotes the benefits of investing in the stock market for the long term, whilst addressing concerns of older savers who prioritise financial certainty.
“Cutting the cash ISA limit is a milestone towards creating a nation of investors. Combined with the planned advertising campaign, changes to risk warnings and the FCA’s targeted support initiative, it will all help people make better long-term investment decisions. We need a strong investment culture in the UK and it is encouraging to see the government starting to build the foundations for this.
“The new cash ISA limit will incentivise more than 2 million1 people to start investing in the stock market – rather than taking the risk of their long-term savings being eaten away by inflation. Of course people need to save cash for a rainy day, but encouraging them to move beyond that will improve their financial resilience, achieve better financial outcomes and bring benefits to the broader economy.”
- ENDS -
Follow us on X @AICPRESS
Notes to editors
- HMRC statistics for the tax year 2022/23 show that of the 7,121,000 subscriptions to cash ISAs, 2,027,000 (28%) subscribed more than £12,500.
- The Association of Investment Companies (AIC) represents a broad range of investment trusts and VCTs, collectively known as investment companies. The AIC’s vision is for closed-ended investment companies to be understood and considered by every investor. The AIC has 286 members and the industry has total assets of approximately £272 billion.
- For more information about the AIC and investment trusts, visit the AIC’s website.
- Disclaimer: The information contained in this press release does not constitute investment advice or personal recommendation and it is not an invitation or inducement to engage in investment activity. You should seek independent financial and, if appropriate, legal advice as to the suitability of any investment decision. Past performance is not a guide to future performance. The value of investment company shares, and the income from them, can fall as well as rise. You may not get back the full amount invested and, in some cases, nothing at all.
- To stop receiving AIC press releases, please contact the communications team.
