Talking about the American trading tariffs dominating the news program, Fresh News has been on a radar about the future of cash in recent days.

Regardless of what form they take, changes almost certainly fall on the track, as the fresh comments of British Chancellor Rachel Reeves suggest. And I think that the British can ensure much better phrases in the long term.

The change is in the air

On Wednesday (April 2), Reeves confirmed her involvement in shaking the current ISA principles during a discussion with the State Treasury Committee of the House of Commons.

While Reeves said she was recognizing “The importance of cash for many people“She added that”I think the reform would be profitable and we are looking at it at the moment“.

The Chancellor previously said about increasing the British appetite to invest in shares, which gives the economy, while providing people with a better refund.

Describing the tax benefits with Cash Isa, Reeves added “” yesterdayI want to look at balance [between saving and investing]Because I think that sometimes it is a pity for saving people“Erosion in value [their] Savings in reality“.

The best of both worlds

I keep ISA cash myself, so I hope that Chancellor Reeves is based on radical changes in current principles. But then I also buy actions of Great Britain and abroad as well as other assets with ISA shares and shares and self -proclaimed personal pension (SIPP), so I can understand the logic of her plans.

Only a quarter of people in Great Britain currently had shares compared to about 60% in the USA. As a result, millions of British lack the opportunity to build a well nest egg for retirement.

Let’s say that someone invests 400 pounds a month in ISA cash for 25 years. If they manage to provide a 4% interest rate during this period, they would have 205 651 £ Show it to the end.

Let’s think now whether they put £ 300 into ISA and 100 GBP actions in this ISA cash. If they achieved a realistic average annual refund of 8% in the field of action investment, they would sit on the better 336 720 £ In both ISA.

Stock market markets often experience periods of variability we see. But over time they proved that investors have a great way to build wealth.

Risk reduction

Although buying shares is more risky than keeping cash, natural people can reduce this by investing in trust and funds (I have several of my own portfolio).

Take Ishares FTSE 250 ETF (LSE: MIDD). This rotational fund (ETF) spreads the capital of investors into hundreds of shares in Great Britain, such as Direct lineIN ITVIN AND Currys.

This, in turn, can significantly reduce the impact of problems specific to the company and/or industry on the overall return of the investor.

Over the past 21 years, this FTSE 250 has provided an average annual refund of 8%. Concentration on actions in Great Britain means less diversification more global funds. But I still think that today it would be worth a close look.

Although I think that cash plays an crucial role in every portfolio, I think that more risky assets, such as shares, trusts and funds, should also be considered part of each savings plan.