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WESLEYAN - Financial care since 1841

Southern savers 'set more aside'

Research has shown that savers in London and the South East are more likely to take advantage of their tax-free savings allowance than consumers in other parts of the country.

Halifax revealed that almost three-quarters of the top 30 local authorities in which people have saved the most into a cash isa are in those regions.

Meanwhile, savers in the Derbyshire Dales have the highest average isa balances at £10,478, which 34 per cent more than the UK average of £7,836.

People from South Bucks, Harrow, Chiltern in Buckinghamshire, East Dorset and Brentwood in Essex have all also compiled an average of more than £10,000 into the tax-free accounts.

At the other end of the spectrum cash isa savings are lowest in the London Boroughs of Hackney and Southwark, with people setting aside around £4,760 and £5,260 respectively into their accounts.

Savers in Glasgow and West Lothian, both in Scotland, have the next lowest amount set aside in an isa at £5,294 and £5,346 respectively.

Overall, 13 of the top 30 local authorities with the highest average levels of isa savings are in London, while nine are in the South East and four are in the East Midlands.

But only one local authority makes it on to the list in the South West, North, North West and East Anglia, while there are none for Yorkshire and Humberside, Wales, the West Midlands, Scotland and Northern Ireland.

Flavia Palacios Umana, head of Halifax Savings Products, said: "Despite the majority of the large cash isa balances being held in London and the South East, it is the Derbyshire Dales in the East Midlands that has the highest average balance of all at £10,478.

"However, this only equates to just over twice the annual isa limit and falls to as low as one-and-a-half times at a national level.

"Many savers are still not making the most of their savings by using their full annual isa allowance, which will earn them interest free of tax."

Unsurprisingly, average isa balances tend to increase with age, with people aged between 18 and 24 having the lowest savings level at £1,940, while those aged over 75 have the highest level at £13,689.

People can save up to £10,200 into an isa during the current tax year, up to £5,100 of which can be paid into a cash isa.

From April 5, the annual Isa allowance will increase to £10,680, of which £5,340 can be saved in a cash isa.

:: The research is based on the amount people had held in cash isas with Halifax in January.

Copyright © Press Association 2011

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