Kevin Brown

Meanwhile, the value of those new policies also dipped -6% over the same period.

That picture was uniform across age groups and regions in the UK. Quarter-on-quarter new policy sales for those aged 18-34 years dipped -4% when comparing Q1 2023 to Q4 2022. The same was true for those aged 35-49 years (-8%) and 50-64 years (-8%). New policy values also fell by -1%, -5% and -8% respectively.

Across the UK new ISA sales dropped most significantly Q4 2022 to Q1 2023 in Wales (-14%) and the South-West (-11%) with all other regions falling between -4% and -8% 

Equally, the value of new policies went into negative territory in all regions in the last quarter aside from the South-West (+9%) and Northern Ireland (+1%). The most significant drops in value of new policies were seen in Wales (-17%), East Midlands (-16%) and the South-East (-15%).

The opening of new Junior ISA policies also reduced significantly Q4 2022 to Q1 2023 down -35% over the period but, was +108% up since Scottish Friendly began recording data in Q1 2019.

More encouragingly though, the value of new JISA policies was up +24% over the last quarter, perhaps pointing to an end of tax year rush into children’s long-term savings vehicles for those in a position to do so.

Kevin Brown, savings specialist at Scottish Friendly, commented: “The data from Q1 2023 seems to confirm what we suspected would happen in Q4 2022 across the industry. Financial pressures are mounting on households across the country and that is making it harder to put money aside for the long-term in stocks and shares ISAs or Junior ISAs.

“Our data suggests that while the heavens haven’t opened there are some spots of rain we are all feeling. As a result, the money people would be setting aside for those rainy days is being put to work meeting rising financial demands. It’s unsurprising that purse strings are stretched when you consider households have had to readjust to several consecutive base interest rate rises since December 2021 and CPI inflation remains stubbornly sticky at 8.7% as food and energy prices remain high.

Mr Brown concluded: “However, while the pace of new ISA and Junior ISA policies opened and their values have slowed, the long-term commitment to saving and investing remains. What is particularly pleasing is that saving and investing for children remains a high priority despite the obvious headwinds. In addition, although adults saving into stocks and shares ISAs for themselves remains a challenge for many, we do know that individuals still have a commitment to do so when they can.”