How to make more out of flexible ISAs with IG

(AI Video Summary)

What is a flexible ISA?

A flexible ISA is a great feature that you can find in either a stocks and shares ISA, or a cash ISA. Basically, it lets you have some freedom in how you invest your money. In the UK, if you're 18 or older, you can invest up to £20,000 each tax year across all of your ISAs. This includes a mix of cash and stocks and shares ISAs. But not all ISA providers offer this handy flexibility thing.

Let me break down how it works with an example. Let's say you already invested £20,000 in an ISA in a previous tax year. Now, in the new tax year, you have another £20,000 to invest. Let's imagine you decide to take out £10,000 from your existing ISA to invest in something outside of your ISA. Well, because of this flexibility magic, your new ISA allowance for the current tax year would effectively be £30,000. You see, you can replenish the £10,000 you took out from your ISA and still have the full £20,000 to invest in your ISA this year. That's pretty useful!

This flexibility is especially great for people who like to be active investors and might find opportunities outside of their usual ISA investments. They can put their money into something else and then put back the amount they took out from their flexible ISA. And, they still have the whole £20,000 limit to invest in their ISA.

Types of ISAs that IG has on offer

By the way, IG offers two types of flexible ISAs. The first one is the Smart Portfolio ISA (which I co-manage), which is a multi-asset investment portfolio. The second option is the Stocks and Shares ISA. Both of these options give you the flexibility feature, so you can make the most of your investments within the ISA system.