Cash Isa Allowance Saved: Is This a Temporary Victory?

The cash ISA allowance was previously expected to be cut in the upcoming Mansion House speech, but Rachel Reeves has reconsidered her stance. It is unclear whether the allowance has been saved for good or if this is a temporary reprieve. The This is Money Podcast discusses the potential fate of the cash ISA, Nvidia's recent record-breaking valuation, and other personal finance topics.

The cash ISA allowance remains unchanged, despite initial speculation that Chancellor Rachel Reeves would announce a reduction in the £20,000 tax-free limit [1]. The Treasury has decided against this move, aiming to encourage more investment in stocks and shares [1]. The decision comes as the government continues to explore options for reform with banks, building societies, and investment firms [1].

The uncertainty surrounding the cash ISA limit has led some savers to consider alternative investment options. Money market funds within stocks and shares ISAs have gained traction, offering tax-free, cash-like returns. These funds have become popular due to rising interest rates, with some currently yielding over 5% [2]. For instance, the Royal London Short Term Money Market fund has a historic yield of 5.3% [2]. Investors can now consider putting their entire ISA allowance into these funds, providing they are comfortable with the slight risks involved [2].

Meanwhile, Nvidia has achieved a significant milestone, becoming the first company to reach a $4 trillion market cap. The tech giant's shares jumped more than 2% on Wednesday, surpassing Microsoft and Apple in market value [3]. This record-breaking valuation is a testament to Nvidia's leadership in the generative AI hardware market, despite ongoing geopolitical tensions and chip curbs [3]. The company's shares have surged more than 15% over the last month and 22% since the start of the year, driven by growing demand for AI hardware [3].

In conclusion, while the fate of the cash ISA allowance remains uncertain, savers have alternative options to explore. Nvidia's record-breaking valuation highlights the potential in the AI hardware market. Investors should stay informed about these developments and consider their financial strategies accordingly.

References:
[1] https://www.bbc.com/news/articles/cqjq9yxkkrvo
[2] https://moneyweek.com/personal-finance/isas/how-to-earn-over-4-percent-on-your-cash-using-a-stocks-and-shares-isa
[3] https://www.cnbc.com/2025/07/09/nvidia-4-trillion.html