Martin lewis warns savers despite reeves backing down on cash isa shakeup

CHANCELLOR RACHEL REEVES HAS APPEARED TO BACK DOWN ON PLANS TO SLASH THE CASH ISA ALLOWANCE, BUT MONEY EXPERT MARTIN LEWIS HAS WARNED THAT SAVERS SHOULDN'T GET TOO COMFORTABLE 02:57, 22

May 2025Updated 03:26, 22 May 2025 Labour officials have been poring over strategies to nudge savers towards the stock markets, with a Treasury minister previously suggesting that

"hundreds of billions of pounds in cash ISAs" are being diverted from the London Stock Exchange. Chancellor Rachel Reeves made her position clear to the BBC, saying: "I'm

not going to reduce the limit of what people can put into an ISA. I absolutely want to preserve that £20,000 tax-free investment that people can make every year. "But I do want people

to get better returns on their savings, whether that's in a pension or in their day-to-day savings." Yet, Money Saving Expert guru Martin Lewis sounded a note of caution about this

commitment. He mused on X: "Reading between the lines its seems that, she is still considering announcing a cut specifically to the cash ISA allowance for new money (rumoured from

current £20k down to as low as £4k) as part of Autumn Statement." While Reeves may have backpedalled on slashing the Cash ISA allowance, her determination to coax savers into the stock

market remains steadfast. She also imparted to the BBC: "At the moment, a lot of money is put into cash or bonds when it could be invested in equities, in stock markets, and earn a

better return for people." The Chancellor is expected to launch a consultation to gain views across the City of London into how the Isa market could be reformed. The Government hinted

at at radical shake-up of Isas in the Treasury's Spring Statement document. At the time, the Government said it wanted to "get the balance right between cash and equities to earn

better returns for savers" and "boost the culture of retail investment". Lewis elaborated on why the statement might not be as straightforward as it seems, stating: "They

were done in the (I suspect mostly forlorn) hope people will shift to investing that money, as the investment (and total) ISA limit would stay at £20,000 or even rise. "In my view

better investment education, communication and widespread accessible guidance would be a more effective way to the same goal." Article continues below Currently, Britons have an annual

£20,000 tax-free allowance and they can choose to have a stocks and shares version, a cash version, or split between the two as they see fit. But rumours have persisted in recent months that

the cash element could be cut to as low as £4,000 a year to push more people into investing. _FOR THE LATEST BREAKING NEWS AND STORIES FROM ACROSS THE GLOBE FROM THE DAILY STAR, SIGN UP FOR

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