Today's question: should the Cash ISA limit be increased?

by Simon Ward on 23 November 2011  |  18 comments
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Nationwide has called for an increase in the tax-free cash savings limit. We want to know whether you think this is a good idea.

Nationwide has called for the current Cash ISA limit to be doubled from £5,340 to £10,680 in order to help more first-time buyers get a deposit together.

It says that the Government’s announcement of a series of initatives to help first-time buyers (which we wrote about here) is a good start.

But Nationwide says an increase in how much people can save tax free is another measure that could help kickstart the housing market. It’s also calling for increased flexibility in allowing people to move their money between Cash ISAs and stocks and shares ISAs.

Any increase in the Cash ISA limit could potentially help hard-pressed savers, although there are very few products out there, particularly instant access and short-term rates, that beat inflation. There’s also the question of whether people have enough spare cash in these hard times to make increasing the limit a worthwhile endeavour.

We want to know your thoughts on this issue. Will raising the Cash ISA limit help first-time buyers save more? Will it help savers? Or is it just a small proposal that will make no real difference?

If you're looking for a Cash ISA, head to our ISA comparison centre.

More: Which savings account should you get? | Seven top cash ISAs and five good shares ISAs