Could you become an ISA millionaire in under 25 years? Five steps to help you get there
ISAs offer a tax-efficient environment for your savings and investments to grow.
In the 2026/27 tax year, you can contribute up to £20,000 across your ISAs, and they remain one of the most popular financial schemes in the UK.
A report in MoneyWeek found that the number of ISA millionaires has reached a record high of 5,070. If that money were held in a regular savings or investment account, it would likely face significant tax on the interest or returns, but held in an ISA, it faces no tax.
While becoming an ISA millionaire won't happen overnight, the latest figures demonstrate what can be achieved by making long-term, regular contributions and the power of compounding.
Read on to discover five steps that could help you become an ISA millionaire.
1. Invest in a Stocks and Shares ISA
Stocks and Shares ISAs typically offer stronger returns than their cash counterparts over the long term, as market returns are generally higher than interest, although past performance is not a reliable predictor of future performance.
Indeed, a government report notes that the average return for stocks and shares over the last 10 years is around 9%. Meanwhile, around 29 million people have cash sitting in accounts with interest rates as low as 1%.
While Cash ISAs can play an important role in building your emergency savings and funding your short-term goals, Stocks and Shares ISAs typically give your money greater potential to grow over the long term.
Of course, investing involves risk, and the value of your investments can fall as well as rise. However, when investing over the long term, accepting some risk has historically been rewarded with stronger long-term growth than holding your savings in cash.
2. Make full use of your ISA allowance as early in the year as possible
The current ISA allowance is £20,000 a year, and making full use of it each year can significantly increase your long-term wealth.
For example, if you invested the full £20,000 allowance every year and achieved an average annual return of 5%, you could accumulate around £1 million in just under 25 years.
Even if you can’t invest the full allowance, contributing what you can on a regular basis is likely to leave you better off than waiting until you feel able to invest larger sums.
Moreover, the earlier you make your investments, the sooner they can begin benefiting from any market growth and compound returns.
Research by Bestinvest found that maximising your allowance at the start of each tax year, rather than at the end, could make you £66,439 better off after 30 years (assuming 5% annual growth).
3. Leave your investments to compound
One of the biggest advantages of long-term investing is compounding.
When your investments generate returns and those returns remain invested, they can begin generating returns of their own. Over time, this creates a snowball effect, as growth builds upon previous growth.
For example, imagine you invested £10,000 that returned 5% each year. After one year, your investment would have grown to £10,500. The following year, you would generate a further 5% on both your initial £10,000 investment and the £500. So, you would have £11,025.
This effect builds exponentially, and compounding can significantly boost the value of your investments over time.
Leaving your investments to compound and grow over the long term can mean they build considerably without any input from you.
4. Stay invested through market ups and downs
Market volatility is a normal part of investing. While it can be unnerving, reacting emotionally to short-term market movements can be one of the biggest obstacles to long-term success.
Selling investments amid a downturn can lock in losses and mean you miss out on the market’s subsequent recovery. Indeed, history has shown that some of the strongest market gains often follow dips.
For instance, research by Schroders found that exiting the market after the biggest crashes between 1877 and 2008 would have meant facing a considerably longer recovery time than remaining invested. This is because the market’s recovery after a fall has been stronger than the growth of cash over the same period.
So, a key part of achieving long-term investment success is acknowledging that fluctuations are part of the journey and remaining disciplined and resilient during downturns.
5. Conduct regular investment reviews
Although the road to becoming an ISA millionaire is a long-term commitment, it doesn't mean you should simply forget about your ISAs.
Reviewing your portfolio regularly allows you to ensure it still reflects your goals, time horizons, and attitude to risk. As your circumstances change, your investment strategy may also need to evolve.
This may mean moving your holdings into higher- or lower-risk investments or transferring funds from a Stocks and Shares ISA into a Cash ISA as you approach certain goals.
A financial planner can help you build an approach based on your needs and risk profile. They can work with you to build a plan for your ISAs that, with the right care and attention, could help you reach the £1 million target sooner than you think.
To speak to a financial planner, get in touch.
Email info@mlpwealth.co.uk or call us on 020 8296 1799.
Please note
This article is for general information only and does not constitute advice. The information is aimed at individuals only.
All information is correct at the time of writing and is subject to change in the future.
Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.