New research conducted by Skandia UK, the London based arm of the Swedish savings firm, indicates that three out of five consumers see 'long-term' as five years or less when it comes to investing in equity ISAs (Individual Savings Accounts). The savings provider sees this as an unhealthy short term view among UK consumers to their savings.
Skandia says its research showed that most consumers take a short term view for their savings which is in stark contrast to their attitude towards borrowing, with most people not thinking twice about signing up for a 25 year mortgage. Skandia claims consumers need to be made aware that five years should be the minimum term for an ISA invested in shares rather than the maximum.
According to the research, young people are most at risk in terms of their attitude. One in five of the 16 to 24 year olds surveyed saw ‘long term’ as just three years or less. The 35 to 44 age group had the most realistic attitude towards long term ISA investments with 43% saying they consider long term as being ten years or more.
Only 13% of respondents were prepared to accept higher risk in the pursuit of higher investment growth, while women proved more cautious than men with 43% saying their main concern was the safety of their investment compared to 31% of men.
Ian Thomas, investment marketing manager at Skandia, said: Our research highlights the need for expert financial advice when it comes to equity ISAs. ISA investments are an excellent way for people to invest in shares for the long term but it seems that advisers have an important part to play in educating their clients about what constitutes long term.