Investors who fund their stocks and shares ISA at the start of each tax year could accumulate significantly more wealth than those who delay, according to new research. A study by InvestEngine found that an early investor who maxed out their ISA each April since 1999 would now have a pot worth approximately £1,277,963, compared to £1,195,127 for a last-minute investor—a difference of £82,836.
Even smaller contributions reap rewards: investing £1,000 at the start of each tax year over the same period yielded over £6,500 more than waiting until the end. Separate research by Fidelity International examined a drip-feed approach, where money is invested monthly. Over 25 years, early investors generated £777,803, while monthly savers netted £755,399 and latecomers £735,646.
Marianna Hunt, personal finance expert at Fidelity International, said: “For many people, investing regularly can make the process feel more manageable. It helps reduce the pressure of trying to time the market and can take some of the emotion out of investment decisions. What matters most is making use of your ISA allowance and maintaining a long-term focus.”
However, returns are never guaranteed with a stocks and shares ISA, and the value of investments can go down as well as up. ISAs allow savers to avoid paying tax on interest or profits, with an annual allowance of £20,000. Alice Haine of BestInvest noted that taking advantage of the allowance makes sense: “No one wants to pay tax on money they have already been taxed on, which is why ISAs are a must-have financial accessory.”
