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What’s the secret to becoming an ISA millionaire?

Sarah Coles, Hargreaves Lansdown Senior Personal Finance Analyst and Podcast Host for Switch Your Money On
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  • There are 973 Hargreaves Lansdown ISA millionaires – up from 576 last year – or 69%.
  • There are 2,000 ISA millionaires in the UK.
  • The average age of an HL ISA millionaire is 72.
  • The most common age among HL ISA millionaires is 73, but we have some ISA millionaires in their 20s and 30s.
  • Just over two thirds of HL ISA millionaires are men.
  • A third of HL ISA millionaires maxed out their allowance in the first month of this tax year, and by January well over half had used their full allowance.

Source: Hargreaves Lansdown; Figures correct on 31/12/2021

Hargreaves Lansdown (HL) has reported that the number of their ISA millionaires is up more than two thirds in a year. According to the report, the ISA investors benefited from rises in global markets over the past 12 months and were boosted by another £20,000 allowance, but they also hold the lesser-known secret to making a fortune from ISA investments: getting rich slowly.

This is according to Sarah Coles, senior personal finance analyst, Hargreaves Lansdown who says, on the whole, ISA investors don’t take enormous risks.

More of them hold collective investments than single shares. Their focus is to consistently invest as much as possible of their annual allowance, as early as possible in the tax year, in a diverse and balanced portfolio. And they’ve done this every year for decades.

There are some exceptions to the rule, who have built a million in quick-time, and some ISA millionaires are still only in their 20s or 30s. However, most tend to be much older – and the average age is 72.

Sarah Coles, senior personal finance analyst, Hargreaves Lansdown

The top ten shares held by this group are dominated by blue chip companies, including those that traditionally pay strong dividends. It means most of them aren’t speculating, they’re investing for the long term.

When it comes to funds and other collective investments, ISA millionaires have a broad international mix of popular funds, according to the financial expert.

“There’s also an income fund in the top ten, which reflects the fact that as investors get older, some of the portfolio may have been reconfigured for income. When you have a larger portfolio, you have more scope to add specialist funds into the mix too, which is why we see micro-caps and special situations in the top ten.”

Top 10 shares held by millionaires as of 31 December 2021 (in alphabetical order and excluding investment trusts)

  • AstraZeneca plc
  • Aviva plc
  • BP Plc
  • GlaxoSmithKline
  • Legal & General Group
  • Lloyds Banking Group
  • National Grid
  • Rio Tinto
  • Royal Dutch Shell
  • Unilever plc

Top 10 funds held by millionaires as of 31 December 2021 (in alphabetical order)

  • Artemis Income
  • Fidelity Global Special Situations
  • Fidelity Special Situations
  • Fundsmith Equity
  • IFSL Marlborough UK Micro-Cap Growth
  • Jupiter European
  • LF Lindsell Train UK Equity
  • Lindsell Train Global Equity
  • Rathbone Global Opportunities
  • Stewart Investors Asia Pacific Leaders Sustainability
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