He said some savers could get much better returns by making some account changes
Martin Lewis has shared some guidance for savers about how to get much better returns. He offered some words of wisdom on his BBC podcast regarding ISAs and the most effective ways to grow your savings over the long term.
The cash campaigner shared some advice on the choice between investing and cash savings, and which approach is most suitable for building up your savings pot over an extended period. He was talking in particular about building up savings for your children, but the same principles hold true for anyone trying to boost their savings over the long term.
The founder of the Money Saving Expert website highlighted a concerning pattern. He told listeners that the overwhelming majority of enquiries on the site about junior ISAs focus on the top cash rates, rather than stocks and shares. A major advantage of ISAs is that these accounts are tax-free, with no HMRC bills on any investment growth or interest earnings held within an ISA wrapper.
You can stash away up to £9,000 a year into a junior ISA for a child under the age of 18. Each adult also receives a separate ISA allowance, enabling them to deposit up to £20,000 a year into ISAs, which they can split as they wish between cash ISAs and stocks and shares ISAs.
Greater growth
Mr Lewis was determined to encourage people to consider investing if they are saving over the long term. He urged: “I need to be really strong.
“So many of you are so desperate to protect your children and build a nest egg for them for the future. But by putting it all in savings, if you’re locking it away for 10, 15, 18 years, I think you’re probably doing a disservice.
“I think there is an element of risk that you need to take in the hopes of greater growth. Some of it is probably worth putting, or all of it if you choose to, in a shares junior ISA over that period.”
Huge risk
However, the consumer expert did highlight a crucial error to steer clear of when selecting which company to invest in. He said: “But not in one share. Let’s remember, put it in one share is a huge risk, you could lose all your money.
“Put it in 5,000 different companies by using a tracker fund that maps 5,000 different companies’ returns, then you are spreading the risk, you are smoothing it all out. You are hoping that the world economy grows, as it usually tends to do, and if it does grow, I’ll benefit from that growth.”
This approach of spreading investments across a group of 5,000 companies was put forward by a financial planner who had previously featured on the podcast. Ed Marshall, from Deans Wealth Management, told Mr Lewis: “You want to be more than just the FTSE 100 or the S&P500.
“If you look at the MSCI world index, you’ve got the world’s largest 2,500 companies. But then you can buy global tracker funds, that will buy even more than those 2,500 shares.
“So instead of just 200 different companies, try and aim for 5,000 plus different companies and try and buy the world, and that diversification will help to take risk off the table.”
Triple your money
Mr Lewis also provided figures to show just how much the stock market has historically outperformed savings accounts. He noted that over the past 10 years up to the end of 2025, had you deposited £1,000 into the top-paying savings account at the outset and reinvested all your interest earnings, your money would have grown by £270.
This would not have been enough to keep pace with inflation, as you would have needed to earn £390 simply to maintain your purchasing power as the cost of living went up.
However, had you invested that same £1,000 into a global tracker fund and reinvested any dividends, you would have seen returns of £1,980. Had you put the initial £1,000 into the S&P500 over the same 10-year period, you would have generated a remarkable £3,790.
