Investing starter Isa inbound? Government reveals plans to turn savers into investors in the Budget

The Government has announced a new Isa 'incentive' to encourage Britons to invest following its move to ditch the reduction in the cash Isa allowance.A cut to £12,000 for under 65s had been announced by the previous Chancellor, Rachel Reeves, as a way to encourage more people to start investing.Under the plans, the stocks and shares Isa allowance was set to stay at the full £20,000.However it wasn't a popular policy, with many experts saying that it was adding complexity to the Isa system – and was unlikely to have the intended effect.Early reaction to the proposed starter stocks and shares Isa has been positive, but experts are keen to stress that it shouldn't make the Isa system more complex.Rob Morgan, chief investment analyst at investment platform Charles Stanley Direct, said that another Isa would add to a 'cluttered regime' but is 'well intentioned in terms of encouraging cash hoarders to switch and grow their wealth more effectively'.In the Treasury document, it says: 'The Government recognises the importance of making investment more accessible to savers, supporting households to build their wealth.' Greater growth potential: The Government is keen for Britons to start investingWhat could a starter investment Isa look like?There's very little detail at the moment, with the Government saying that the design will be developed with the investment industry.Experts agree that any new product should be simple to understand. Isabella Galliers-Pratt, senior investment director at investment management firm Rathbones, said it could take the form of a government 'top-up on an initial investment, for example, giving people a tangible reason to take that first step'.This could look 'similar to the Lifetime Isa model' said Jennifer Crichton, associate planning director at financial planning firm Killik.Daniel Wills, financial adviser at money management app Plum, told us that paying a 'top-up once the money has stayed invested for a year would reward people for building a habit, not just for opening an account'.Importantly nobody should lose their money for needing it back, he added. 'The Lifetime Isa's withdrawal penalty meant some savers who take money out early get back less than they paid in, and that kind of experience can put a nervous first-time investor off for good.'If someone needs their money before the qualifying period ends, they should simply give up the top-up and nothing more'.Finally any new account should sit 'alongside and not weaken' cash Isas, said Lawrence Chan, head of savings at Nottingham Building Society.> Read more: Five of the best cash Isas Don't put off investing if you want to startEarlier this year, a select number of investment platforms introduced a feature called targeted support, which is a programme backed by the financial regulator, the Financial Conduct Authority (FCA).It's a non-advised service that gives people suggestions about which investments to choose, based on what's best for people in similar circumstances. What the Budget really means for you Hi, I'm Simon Lambert, publisher of This Is Money, and now that the Budget has landed, it's important you get your finances in order. We now know exactly what the Budget included and what you need to do to protect your money. But it's not just this Budget we need to worry about, as a painful set of tax raids were already on the way. So, I've enlisted the help of leading financial experts to create a six-week plan. We explain what you need to know and how to protect your finances. > Click here and sign up to Protect Your Money now Targeted support isn't personalised. But the regime is already 'making it easier for people to get guidance on whether investing could be right for them, which the previous rules made difficult', said Andrew Prosser, head of investments at exchange-traded fund investing platform InvestEngine.Investment platforms including Vanguard and Quilter Invest already offer targeted support, with Barclays and Plum gaining approval from the FCA to offer it in the future.Indeed, a new starter Isa could give a 'short list of ready-made, diversified options with clear risk labels and low charges, so people aren't worried about picking the wrong thing,' said Daniel Wills from Plum.Keep in mind that there's a lot of help out there already if you want to start investing. Putting it off until the launch of a new starter Isa could lead to years of missed growth potential, and it's unclear how substantial any incentive will be regardless.There's lots of information available that can help you get a head start.We have our own guides on how to start investing and the best stocks and shares Isa to choose.Many platforms also produce their own educational content such as investment ideas and guides on key investing topics.If you're thinking about the best platform to try, have a look at our in-depth reviews, which examine fees, investment choice and educational content and more. Investing platform reviews