Dip in the number of Isa millionaires as stock market volatility takes its toll

There are 520 fewer “Isa millionaires” following a period of global stock market volatility, according to the latest annual figures.

HM Revenue and Customs (HMRC) revealed the dip following a Freedom of Information (FOI) request by InvestingReviews.co.uk.

Figures from the revenue body showed millionaire numbers fell by just over a quarter to 1,480, down from 2,000 the previous year.

Despite the dip in overall numbers, the average millionaire pot grew by 7% year-on-year to £1,513,000, from £1,412,000 a year earlier.

And the number of investors with £3 million-plus in their Isa jumped from 60 a year earlier to 90.

At the very top of the Isa tree, 40 investors had pots worth at least £4 million. HMRC said their average holdings stood at £7,921,000.

Savers’ money held in Isas is ringfenced from the taxman and up to £20,000 can be contributed in the current tax year.

Stocks and shares Isas often perform more strongly over the longer term than leaving money in cash, although there is the risk that the value of investments can go down as well as up.

HMRC’s latest millionaire figures were produced from data representing Isa values on April 5 2020, a period when the coronavirus pandemic and lockdowns were heavily impacting global markets.

The figures were compared with the number of Isa millionaires a year earlier, in 2019.

InvestingReviews.co.uk CEO Simon Jones said: “We expect Isa millionaire numbers to rebound in the short to medium term as equity markets recover from a period of uncertainty.

“For investors with a long-term horizon, a stocks and shares Isa remains an excellent route to millionaires’ row.”