The Benefits of Cash ISAs

A Cash ISA can come in handy if you're saving for a near-term goal or looking to set up an emergency fund

Holly Cook 11 March, 2013 | 6:30AM
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This article is part of the special series, Investing with ISAs.

We've looked into the essentials of stocks and shares ISAs, but what about Cash ISAs? Though there may be little incentive to save your hard-earned cash with accounts offering interest rates below inflation, Cash ISAs can still come in handy if you have a near-term goal or need to set up an emergency fund. For example, it's generally recommended that people put aside three months of earnings to cover themselves in case of an emergency such as job loss. In this scenario, a Cash ISAs can come in handy.

What Is a Cash ISA?
A Cash ISA is a standard bank or building society savings account that is shielded from tax by being in an ISA wrapper. This means that you won't have to pay income tax on any interest accrued.  These Cash ISAs are often offered by supermarkets, retailers and financial advisers.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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About Author

Holly Cook

Holly Cook  is Manager, Morningstar EMEA Websites