Consider risk attitude when investing in cash Isas, says Nationwide

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Consider risk attitude when investing in cash Isas, says Nationwide

Wed 9th Feb 2011

Savers should consider how much risk they are willing, or able, to take on when they choose an Isa.

This the advice of Nationwide's director of savings and investments Robin Bailey, who said people putting their money to one side should think about the purpose of the funds and the return they would like to make on them.

Stocks and shares Isas, for example, can be a high-risk investment, but those who are prepared to take a gamble could see higher returns than they would from deposit-based accounts.

Meanwhile, people who would like to earn from their saving without taking a significant risk may be more comfortable with Cash Isas.

These products are "ideal" for saving emergency funds, Mr Bailey said, while stocks and shares deals would need to be held for a term of around five years or more.

More cautious savers considering a cash Isa may be interested to know the Post Office recently announced new rates of up to 3.6 per cent on its fixed-rate products.

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