Government plans to cut Isa allowances are likely to hit the one in five people using investments to help fund retirement, according to research by ICM.
Commissioned by Intelligent Finance, the survey reveals 21% of the 1000 people questioned plan to take out an Isa to boost their retirement funds.
This figure rises to almost three out of 10 people in the 35-44 age bracket and shifts to more than one in three (35%) of the 55-64 year-olds.
This is despite government plans to scale back the amount of money which can be invested in an Isa from 2005 from £7,000 on maxi Isas to £5000 and £3000 on mini (cash) Isas to £1000.
IF says evidence indicates Isas are especially popular with low to middle income groups for building up their retirement savings, as 22% more people in the middle bracket use Isas for retirement planning, compared with the national average.
More than 1.1m people from low to middle income groups are said to have invested over £1,000 in cash Isas last year.
Grenville Turner, chief executive of IF, says “this is the wrong time to be cutting incentives which are driving long-term savings" as consumers are choosing to use Isas to secure a better retirement nest egg.IFAonline
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