Savers have been encouraged to look at one type of account to build up their savings. The Government recently announced new restrictions on how much you can deposit in certain accounts.

As the rules will be changing soon, now is a good time to look over your savings portfolio and think through what your long-term financial goals are. One popular option is ISAs, as any interest earnings or investment growth within these accounts is tax-free.

You can pay up to £20,000 a year into these accounts, but these rules are changing. From April 2027, you will only be able to pay up to £12,000 of this allowance into cash accounts. The remaining £8,000 will only be available to deposit into stocks and shares accounts.

These new rules will not apply to people aged 65 and over, who will retain the current allowance. Wander Rutgers, UK CEO of investment platform Lightyear, said that ISAs are a good choice for people looking to build up their savings.

He said: “For most investors, who invest or save less than £20,000 yearly, having all that money in some type of ISA rather than a GIA (General investment account) or normal account makes sense.” He explained that it’s worth bearing in mind when the allowance resets.

Mr Rutgers urged: “Your limit resets on the 6th of April, so put anything you can into the ISA to benefit from this year’s allowance if you haven’t filled it yet.” The savings expert said the key factor with investing is to stay consistent with your deposits and to give your holdings the time they need to grow.

The key factor

He said: “The biggest factor in long-term investing success isn’t picking the right moment or the right stock, it’s how early you start and how regularly you invest. To put that into real terms, someone who invests £100 a month for 30 years could build around £100,000 over time.

“Wait just ten years to start, and that figure can drop to closer to £45,000, even though you’re investing the same amount each month. That gap isn’t about skill, it’s about time.

“The sooner investing becomes a routine part of life, the more powerful it becomes. The most effective approach is simple: decide what you’re investing for, spread your money across diversified investments, and contribute automatically every month so you’re not constantly second-guessing yourself.”

Look at the full range

The team at ISA provider Moneybox also shared some thoughts on how to best build up your ISA savings. Brian Byrnes, director of personal finance, said: “It’s important to consider the full breadth of ISA offerings, as some may be better suited to particular goals.

“For example, a Cash ISA is great for building your emergency fund or short-term savings, and can be an enabler to long term investing providing ordinary savers with the peace of mind and financial resilience needed to invest with confidence.

“A Stocks & Shares ISA is ideal for anyone with a solid savings buffer looking to build long-term wealth, and a Lifetime ISA (LISA) can be utilised to help buy your first home or save for retirement.”

Mr Byrnes said it’s good to look at comparison websites such as MoneySavingExpert, as they regularly update their tables with the best rates available.