The ISA world is your oyster

As those over 50 try to work out how best to make use of the extra ISA allowance that has now come their way, those of us with a bit more youth on our side still have to wait until next April for the new limits to come into play.  Having come into effect from 6 October for anyone born on or before 5 April 1960, the new rules have seen the overall ISA allowance increase from £7,200 to £10,200.For those with a penchant for risk, the whole allowance can be invested in a stocks and shares ISA. But be warned, there is absolutely no guarantee you will get all your money back. For the more conservative saver, up to £5,100 can be placed in a cash ISA (up from the previous limit of £3,600). Introduced in 1999 to try to kick start a savings habit in the UK, the popularity of ISAs still proves strong today. Around £400 billion worth of funds are currently stashed away in these tax-free accounts. Providers, unsurprisingly, are keen to get their slice of the action and offering some attractive rates as a result.Indeed, accounts that are only available to those over the age of 50 have recently been all the rage.However, savers over the age of 50 should know they are not restricted to these accounts alone: the whole of the ISA market is their oyster to find the account type and rate that best meets their needs.  Besides the standard cash option, fixed rate ISAs involve your money being locked away for a given period of time; generally, the longer you’re prepared to forego your funds, the better the rate of interest you’ll receive. It’s also important to remember that transferring your ISA from one provider to another is allowed, so you can continually hunt for the best rates around. Meanwhile switching your money between the types of ISA might be another option worth considering. Changes to the rules in April 2008 means swapping from cash into stocks and shares is easily done and does not affect your yearly allowance. However, it is not a two way street. Anyone wanting to take their funds out of their stocks and shares ISA and put them into cash still has to use the annual contribution allowance to do so. It is therefore not a decision to be taken lightly.But while cash ISA rates might not currently be what they once were, for the safety conscious investor, they’re still one of the best bets around.