Endorsed by Which? and Boring Money for over 5 years
“It's a great way to save for my future. I just wish I’d invested earlier in my life!”
Why tax year-end matters
Making the most of your tax-free annual allowances will help give you the best chance of investment success.
The end of the tax year is 11.59pm on 5 April, which is the last time you can make tax-efficient investments this tax year. You cannot carry forward unused ISA allowances to another tax year.
Make the most of your allowances
Stocks and Shares ISA | Personal Pension | Junior ISA | General Account | |
|---|---|---|---|---|
Annual allowance | £20,000 | £60,000 or your income, if it's less. £3,600 if you do not earn anything. | £9,000 | Unlimited |
Tax relief on contributions | ||||
Tax-free withdrawals | 25% – the other 75% is taxable income | Tax-free, when the child is 18 | ||
Carry forward allowance | Previous 3 tax years | |||
Investing beats saving in the long term
If you had £10,000 cash in 2005
£74,000
Worth today
Invested globally
£4,100
Worth today
Saved in bank account
Note: Cash returns represented by the UK Sterling Overnight Index Average benchmark (SONIA). SONIA reflects the average rate of interest banks pay to borrow overnight. Global shares represented by the FTSE All-World Index with dividends reinvested. Inflation represented by the UK Retail Price Index (RPI). Past performance is not a reliable indicator of future results. The performance of an index is not an exact representation of any particular investment, as you cannot invest directly in an index.
Source: Factset, Vanguard calculations based on period 31 December 2004 to 31 December 2025.
Why it's smarter to invest than save
Long-term returns
Investing can be a powerful way to build wealth over time. In the long term, shares deliver higher returns than saving cash.
How your wealth grows
Compounding is when you earn returns on the money you invest as well as on the returns themselves. It can have a big impact on your wealth.
Checklist for saving tax
Top up your accounts – even a little bit helps
- ISA – pay in up to £20,000 tax-free per year
- Junior ISA – pay in up to £9,000 tax-free per year
- Pension – pay in up to £60,000 tax-free per year (includes personal and employer contributions)
Use your Capital Gains Tax allowance if you have a General Account – £3,000 tax-free per year
Consider a bed and ISA, which means moving investments from your General Account to your ISA
Make life simpler – and reduce costs – by bringing your investments together in one low-fee account.
Transfer your investments to us
Learn about transferring an account to usWhy Vanguard?
Over 50 years of experience
We’ve been taking a stand for investors for over 50 years. Now over 50 million clients worldwide invest with us for their future.
Value
Our funds are good value, which means you can keep more of your returns.
Straightforward
Our range of over 85 funds gives you a low cost and easy way to diversify. And opening an account takes just 10 minutes.
Insights from our experts
What is ‘bed and ISA’ and ‘bed and pension’?
‘Bed and ISA’ or ‘bed and pension’ means moving investments from a general account to an ISA or pension. We discuss how it works and whether it’s worth doing.
How to reduce your Capital Gains Tax bill
More people are getting caught out by Capital Gains Tax (CGT). So how do you protect yourself? Vanguard’s chief financial planner in the UK, James Norton, offers investors some tips.