What is an individual savings account (ISA)?

ISA stands for Individual Savings Account. An ISA allows your savings or investment to grow tax-efficiently. The Government sets the total annual ISA allowance which means your total payments into various ISAs must not exceed that amount in any tax year.

As long as you remain within your annual ISA allowance, you are entitled to have one of each of the following types of ISA, from the same or different providers:

Stocks and Shares ISA

This is also known as an Investment ISA. Our Investment ISAs offer a choice of funds that include bonds and cash as well as stock market investments.

All of Scottish Friendly's ISAs and Junior ISAs are investment-based. Investment ISAs are linked to the stock market and their value can rise and fall in line with stock market performance - therefore they do not have interest rates.

Lifetime ISA

If you are over 18 and under the age of 40, you can open a Lifetime ISA and pay in up to £4,000 a year until you turn 50. This £4,000 counts towards your total annual ISA allowance.

A Lifetime ISA allows you to save or invest for a first home (up to the value of £450,000) or retirement from age 60 and is not currently offered by Scottish Friendly.

Cash ISA

This allows you to save tax efficiently in cash and is not offered by Scottish Friendly.

Innovative Finance ISA

This allows you to lend to others without paying tax on the interest you earn and is also not offered by Scottish Friendly.

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