Over a third of savers plan to turn their back on ISAs this year saying they do not understand the benefits, research suggests.
Widespread uncertainty over the potential gains from ISAs means 37% intend to forgo their allowance for 2009/2010, according to a moneysupermarket.com poll of 1200 people.
Of those who will not be investing, almost a quarter (24%) will avoid ISAs because they do not understand them.
Overall, 80% of respondents admitted confusion over the value of the savings vehicle, despite Government efforts to simplify the rules as well as increasing the amount which qualifies for the tax-free benefit.
Just over half (51%) said they could not afford to save, with the remaining 26% saying they couldn't be bothered to save at all.
However, 50% of respondents have already invested their allowance for this tax year, with the majority of these savers (70%) opting to invest in cash ISAs only.
Almost a fifth (19%) are opting for stocks and shares ISAs. The remainder 11% have split their allowance between cash and stocks and shares.
Kevin Mountford, head of banking at moneysupermarket.com, says: "A lot of people are put off investing in ISAs as they do not fully understand them or think they are overly complicated.
"The abolishment of the mini and maxi distinction will have gone some way to rectify this but clearly there's still some work to be done in educating savers."
Current weak ISA take-up could be offset by some late-coming savers, according to the poll.
A ‘wait and see' approach among 14% of those polled suggests more people intend to take advantage of tax-free allowances but are delaying their decision until the end of the financial year; the time when traditionally the best deals are found.
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