ISAs for the Over 50s

POSTED ON Friday, 16 October, 2020

Investing is a good idea at any age. But what are the best investments for those looking to invest in their fifties? You’ll likely be saving for your retirement – or looking to. You have a lot of options – and we’ve broken them down for you here. 

When looking at putting your money into an ISA in your fifties, there are different considerations you need to think about when spreading your money into different ISA types.

Your £20,000 yearly ISA allowance can be spread over different ISA types which can garner different benefits.

We’ve broken down some key ideas you should be thinking about when putting your pennies to work.

Cash ISA

Cash ISAs are known for having fairly poor return rates – so many people when looking to put their money to work may avoid these. However, they’re not to be sniffed at – they can, in the right context, be helpful.

Your fifties are an age where you enter a higher risk factor for certain illnesses, so it’s useful to have some money squirrelled away in case the worst happens. This is because with Cash ISAs you can generally have easier access to your money such as with an Instant Access Cash ISA.

So in the case of a rainy day, it can be useful to know you can get to your money when you need it. 

Read more about Cash ISAs here. 

Investment ISAs

Investment ISAs offer higher rates of return than Cash ISAs, and there is a huge variety of different kinds of ISA accounts you can have.

  1. Ethical Investment ISAs
  2. ETF Investment ISAs
  3. Fund Supermarket Investment ISAs
  4. High Income Investment ISAs
  5. Gold Investment ISAs
  6. Index Tracker Investment ISAs
  7. Share Dealing Investment ISAs
  8. Growth ISAs
  9. Technology Investment ISAs

Read more about Investment ISAs here

Peer to Peer ISA

If your years before your fifties have involved a lot of investing, then you might want to consider a Peer to Peer ISA.

This is a great way to diversify your investment portfolio, whilst also enjoying the potential for very high returns. 

These tend to be more risky as a form of investment, but if you’ve got the years of experience and a good, balanced investment portfolio behind you then these can be a great way to innovate your investments.

Read more about Peer to Peer ISAs here. 

Lifetime ISA

Lifetime ISAs are a specific ISA type which is aimed at long-term savings, and offer a very attractive return rate. The government will add a 25% bonus to the money you put into this account. The limit you can put into a LISA each year is £4000, so the most money you can make it £1000 per year.

It’s designed to be long-term saving which helps you pay for your first home (a goal likely long since past) and also for retirement. You can cash in the ISA at the age of 55.

Even if you’re over 55 you can still open a new LISA, and you’ll still be eligible for the 25% bonus you just need to ensure that you hold the account for at least a year. 

Read more about Lifetime ISAs here.