Surge in the number of savers who are now 'Isa millionaires', new figures show

According to the statistics, the average Isa millionaire had a pot valued at £1,351,000 by April 2022. The top 25 Isa investors were sitting on pots averaging £8,880,000

The number of "Isa millionaires" recorded by HM Revenue and Customs (HMRC) has surged by about a fifth within a year.

Figures from HMRC, show some 4,850 savers had Isa pots worth £1 million-plus by the end of the financial year in 2022, a rise from 4,070 recorded the previous year. The data was obtained through a freedom of information (FOI) request by money app Plum.

According to the statistics, the average Isa millionaire had a pot valued at £1,351,000 by April 2022. The top 25 Isa investors were sitting on pots averaging £8,880,000.

However, HMRC warned that the figures may not reflect the true number of Isa millionaires as some Isa managers may enter records incorrectly or fail to submit each year. Rajan Lakhani, of smart money app Plum, highlighted the tax-efficient appeal of Isas, stating: "Isa millionaire wealth continues to grow, even as other savings and investment products lose a little of their shine following recent tax changes."

He added: "A large part of the Isa’s appeal is the flexibility and liquidity it offers investors. While only a fraction of savers will be able to amass a million pounds in their Isa, investing even small amounts regularly can add up to a significant sum over time, and go a long way to helping people meet their financial goals."

He concluded: "That’s especially the case if you begin your investing journey early. Of course, it’s also important to have a rainy day fund, and a cash Isa is ideal for insulating yourself from future shocks, like a sudden job loss or poor health, or to use for things you need in the shorter term."