Make your Christmas gift an ISA | ArticlesBase.com
By mid-November there is a significant percentage of the population that has already completed their Christmas shopping. Those organised people find buying the right Christmas gifts for everyone incredibly easy. They have almost a telepathic ability to know what their loved ones want or maybe they are just better at picking up hints. Either way they have the entire chore wrapped up well in advance.
For many more of us it is a really difficult challenge to buy the right present and thereby avoid giving the recipient a trip to the shops to exchange their unsuitable gift. Teenagers are notoriously difficult to buy for, as they seem to change their mind weekly in the run-up to Christmas Day. Younger children always want the latest must-have toy that is permanently out of stock and buying for parents is always hard as they seem to already have everything they need!
So, this year if you are not quite sure what could be the most appropriate gift then take a lateral approach. Give money but with a twist; insist it is invested in an ISA " an individual savings account. Thats a great way to help young adults appreciate the benefits of tax-free savings and also encourage them to save for a major purchase or a mortgage deposit.
Of course, there are two major types of ISA; cash or stocks and shares. They are tax-free investment vehicles which the current government introduced in 1999 in order to encourage a savings and investment mentality amongst UK tax payers and residents. Current rules allow anyone under 50 to deposit a total of 7,200 per tax year in ISA. products. However, of that amount a maximum of only 3,600 can be deposited in a cash ISA; the remaining amount may be deposited in a stocks and shares ISA. Alternatively, if an investor does not have a cash ISA the entire 7,200 annual allowance can be invested in the stocks and shares option.
From 6th April 2010 the upper limit will increase to 10,200, with a maximum of 5,100 to be deposited in a cash ISA. However, anyone born before 5 April 1960 can invest that sum now under a change to the legislation, made on 6th October 2009.
Most ISAs can be opened with just a 1 deposit, so any monetary gift can be invested entirely into a cash ISA. As the product is available to any UK resident over 16, then a monetary gift to be invested in an ISA can be given to any adult " perfect for getting around the problem of providing suitable Christmas gifts! Although, youll still have to worry about what to buy the little ones " good luck on that one!
About the Author:
Jonathan Wallace writes for a digital marketing agency. This article has been commissioned by a client of said agency. This article is not designed to promote, but should be considered professional content.
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