Over the last ten years, savers could have earned £24,340 more if they had invested their full allowance at the start of the tax year, rather than waiting until the last-minute to invest, Hargreaves Lansdown found.

According to the firm, savers that invest their entire allowance at the beginning of the tax year also benefit from additional dividends, not just potential growth. A full ISA allowance could earn £960 in dividends in a year.

However, despite the significant growth in potential savings, only one in seven ISA investors open a new ISA as early as possible in the tax year.

Commenting on the findings, Hargreaves Lansdown personal finance analyst Sarah Coles said: “The world of investment is very much like a theme park or a Take That gig: if you want to make the most of it, you need to be at the front of the queue. The earlier you use your ISA allowance in the tax year, the better. Your investments are sheltered from tax straight away, you receive dividends immediately, and your investments have longer to grow – which can have an impressive impact on returns.

“If you invested your full ISA allowance on the first day of the new tax year every year for the past ten years, you could be over £24,000 better off than an investor who waited until the last minute each time. Even just a single year of dividends could be worth as much as £960.”

However, Coles acknowledged that “ongoing Brexit uncertainty” may be “off-putting” for those investors that are considering investing at the moment.

“Although, it’s hard to imagine, the current chaotic situation won’t last forever, and the stock market will ultimately be driven by the growth in company earnings. In the short term, sentiment takes a bigger role, but investment is a long term game, and if you’re putting your money away for 5-10 years or more, the sooner you get started – and the longer you’re invested for – the more growth potential your investments have,” Coles added.

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