The UK’s biggest ISA pots revealed
The UK’s biggest ISA pot is worth over £11.6m, according to new data from HM Revenue and Customs.
A Freedom of Information request from RBC Brewin Dolphin has revealed that in 2021, the top 25 ISA investors were sitting on pots averaging £11,660,000 each. This means that the most valuable ISA is likely worth far more than that.
Introduced in 1999, the ISA initially only allowed £2,400 to be deposited annually, though this has been slowly increased over the years.
The current limit is £20,000, which it was upped to from £15,240 in 2017.
An ISA that had been maxed out since their existence would have only seen £310,760 deposited – meaning that ISAs worth £11.6m would require an annual growth rate of 18.9 per cent.
An investor putting their savings into cash over the same 34-year period would have seen their savings grow from £310,760 to £424,966, but because of inflation, that would have actually been a decline in real terms.
An investor would have needed their savings to grow by a further £40,000 to £464,669 to maintain purchasing power.
The HMRC data also revealed that the number of ISA millionaires tripled to 4,070 in 2021, with the average one holding a pot of £1.4m.
John Lee, a stock-picker and Financial Times columnist, became the first publicly declared ISA millionaire in 2003, reaching it on contributions of £126,200 made over a span of 16 years. His annualised returns during the period were 21 per cent.
Rob Burgeman, investment manager from RBC Brewin Dolphin, said: “While a good investment plan should undoubtedly incorporate both ISAs and pension, the ISA’s phenomenal appeal is perhaps underpinned by the flexibility it offers investors in terms of liquidity.
“Investors can make withdrawals at a time of their choosing regardless of their age, whereas pension savers currently must wait until they turn 57 to start spending their retirement pot.”