It is encouraging to see that in these tough times, savers are managing to build on their ISA balances.
(PRWEB) March 21, 2012
Latest Halifax research shows UK savers are building on their ISA nest eggs. Average balances grew by 14% in the last year; from £7,836 in January 2011 - an increase of £1,113. The growth, which is a trend seen over recent years, shows that since February 2009 the average cash ISA balance in the UK has increased from £7,269 to £8,949 in January 2012 - representing a growth of 23%, or £1,680.
The national average ISA balance of £8,949 is equivalent to a third of national average pre-tax annual earnings1 of £26,871. The biggest savers in relation to earnings are in Wales (41%) and Northern Ireland (40%). The lowest ISA savers, on this basis, are in London (23%) and Scotland (28%).
Unsurprisingly, older ISA customers tend to have higher balances. Savers above 65 years of age have an average balance of around £14,400 – 61% above the average for all ISA savers. Those in the age band 25 to 54 have an average balance close to £5,423, which is 40% below the UK average.
Martin Ellis, economist at Halifax, commented: “It is encouraging to see that in these tough times, savers are managing to build on their ISA balances, making use of the annual allowance. Indeed it is impressive that customers, on average, have an ISA balance equivalent to a third of annual gross earnings.
"At tax year end the 'ISA season' is in full swing and savers can access some very competitive rates in order to make the most of their hard earned savings. Judging by the ISA balances - savers still have spare allowance available to use up this tax year, so now is the time to use it before they lose it."
Average ISA balances across the UK
By region, the East of England has the highest average cash ISA balance: £9,724, 9% above the UK average. Followed by the South East (£9,519) and East Midlands (£9,516).
Scotland has the lowest average cash ISA balance; £7,031 - a fifth below the UK average.
Savers in ninety-seven local authority districts (LADs) in the UK – 25% of the total – hold an average cash ISA balance in excess of £10,000. ISA savers in the Chilterns have the highest average balance which, at £11,688, is 31% higher than the UK average of £8,949.
Harrow in North London has the second highest average ISA balance in the country (£11,670) followed by Derbyshire Dales (£11,640), South Buckinghamshire (£11,601) and Christchurch in Dorset (£11,592). These balances are all a third higher than the UK average.
Three out of five LADs with an average balance above £10,000 are in southern England. The highest savings areas outside southern England include Fylde in Lancashire (£11,159), Hambleton in North Yorkshire (£11,077), Malvern Hills in Herefordshire (£10,657) and Powys in Wales (£10,237).
The areas with the lowest average ISA balances are dominated by LADs in London and Scotland. Hackney has the lowest average ISA balance which, at £5,487, is 39% below the UK average. The East London borough is followed by Glasgow (£5,655), West Lothian (£5,834) and Newham (£5,921).