Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said:

‘UK ISA’

“The Budget announced the ‘UK ISA’ for consumers to invest in UK equity, with all the tax advantages of a traditional ISA. The annual allowance of £5,000 will be on top of existing ISA allowances, good for those who expect to use their current tax-free allowance. Savers must be conscious of all the ISA options available to them and seek advice if they wish to invest in the stock market. The intention of the British ISA is to grow our economy, reward investors and support British business. This new ISA could well incentivise investment in UK-focused assets, but the Government will consult on the details.”

NS&I British Savings Bonds

“Announced today by the Chancellor within the Budget are new ‘British Savings Bonds’ through NS&I, online-only. According to the NS&I website, the expectation is these will be on sale in early April, and more details are expected to be revealed online soon. NS&I is a trusted brand and those savers who want their money safe and perhaps want to support UK businesses could well find these popular. However, the interest rate offered will need to be carefully thought out by NS&I, considering the current state of the savings market, or it could risk being overlooked. As we have seen in the past, NS&I products are popular, but savers will look elsewhere if a much higher rate can be obtained. The Chancellor said the fixed bond will have a three-year term, which may be too much commitment for some savers. Our Moneyfacts Best Buys show many short-term bonds pay more than 5%, but three-year bonds pay much less.”

The Lifetime ISA ‘overlooked’

“There has been a missed opportunity to reduce the withdrawal charge on Lifetime ISAs, also no acknowledgement on wider calls to raise the property value threshold for first-time buyers – it was overlooked. It’s disappointing that consumers who need to unexpectedly access their Lifetime ISA pot will still be susceptible to the 25% withdrawal charge. Any savers considering a Lifetime ISA would be wise to check the full terms and conditions before they enter any arrangement to ensure they are eligible for the 25% Government bonus. If savers have any concerns, they may want to consider alternative savings accounts where they can move their money freely, and sadly miss out on the Government boost that LISA offers.”