Those who invested their full ISA allowance into the FTSE 100 at the start of each financial year, over the past 20 years, would have seen their ISA value grow to £353,064, research from Willis Owen revealed.

The firm highlighted that, by investing at the beginning of the tax year, savers saw returns of almost £15,000 (£14,935) more than if they had waited until the end. When looking specifically at the FTSE All Share, the figure increased to £16,285.

Furthermore, the research found a similar difference between ‘early bird’ and regular savings for the FTSE 100, with regular savers missing out on £15,042. However, despite the figure not being as high, regular savers still would have seen their £206,560 investment grow by 64 per cent.

Commenting on the findings, Willis Owen head of personal investing Adrian Lowcock said: “The numbers speak for themselves. It is time in the market that matters the most, not timing it. Given that stock markets generally rise over the longer term, there is a significant advantage to investing at the start of the tax year rather than waiting until the end. With the increase of the ISA allowance over the past few years, we would expect this gap to grow over time.

“Doing your ISA early also means that your investments grow tax-free for longer. In particular, the income from your investments inside an ISA will not be subject to income tax.

“The benefits of using an ISA early on are more than just financial. By investing at the beginning of the tax year, investors can avoid spending the money on something else. They can also avoid the stress of doing it last-minute, so when the end of the tax year comes, they can relax whilst others are panicking.”

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