With just a few weeks to go until the personal savings allowance (PSA) comes into effect, new research from AA Financial Services reveals that 90% of savers don’t know what the allowance is and are struggling to determine where to put their savings after April.
Once the PSA was explained to survey respondents, almost half (49%) said they didn’t know what to do with their money come April, with the choice between ISAs and savings accounts causing most confusion.
One in six (16%) savers said they would only pay into a savings account from April, and one in 14 (7%) said they would move money out of their ISA and into a savings account.
A spokesman for AA Financial Services, said, “The personal savings allowance is good news for savers, but widespread confusion about what it means for people’s money risks undoing the benefits.
“There will continue to be many differences between savings accounts and ISAs and the decision on what to do with your money isn’t as simple as comparing rates between saving accounts and ISAs.”
Important considerations for savers include:
In spite of the confusion, there is a general willingness to save, with almost one in four (23%) people expecting it to be easier to save over the next few months.
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