New research is highlighting how returns on certain pension funds and ISAs differ, with savers being urged to ensure their money goes as far as possible
Savers across the UK could be forfeiting up to £100,000 from their long-term savings simply because they neglect to properly investigate which funds their money sits in, according to a finance expert.
Antonia Medlicott, founder and managing director of financial education firm Investing Insiders, has carried out a comparison of the top and bottom performing stocks and shares ISA and pension providers to illustrate the scale of potential losses.
The findings reveal significant gaps between the strongest and weakest funds. On a £10,000 ISA investment held over a decade, the difference between the best and worst performers amounts to £21,578, a sum that grows exponentially over longer timeframes.
Disparities in pension funds proved to be more alarming, with some high-risk options nearly tripling savers' money while others wiped out investments almost entirely over a five-year period.
Stocks and shares ISAs typically fall into four main portfolio types, adventurous, balanced, cautious, and conservative, with risk levels decreasing in that order.
Ms Medlicott explained: "Adventurous portfolios offer the highest risk but the highest potential returns, whilst conservative funds offer the opposite."
Her analysis found that the strongest ISA performer over ten years belonged to the adventurous category, delivering returns of 224.98 per cent.
The weakest sat in the conservative bracket, managing just 9.2 per cent over the same period. In pound terms, a £10,000 investment placed in the top-performing fund a decade ago would now be worth approximately £32,498, more than tripling the original sum.
"That's an astronomical difference of £21,578 between the amount of money you would've earned, and that's only over a 10-year period," Ms Medlicott said.
"Increase that to 20, or even 30 years, and the distance between the two grows exponentially."
The gulf becomes even starker when applied to larger savings pots. For someone who had diligently built up £50,000 in ISA savings, the top-performing fund would have turned that sum into £162,490 over the same ten-year window.
By contrast, placing that identical amount in the worst-performing option would have yielded just £54,600, a difference exceeding £100,000.
Analysts note the figures underscore how the choice of fund and risk category can have a transformative effect on long-term wealth, particularly for those who save consistently over many years.
Yet many savers remain unaware of the options available to them or fail to review where their money is allocated. The pension landscape presents an even more dramatic picture.
Among high-risk pension funds, the best performer delivered cumulative returns of 180.28 per cent over five years from 2020, while the worst lost a devastating 98.59 per cent of its value.
Ms Medlicott shared: "This means someone with a £50,000 fund would have increased their pot to £140,140 in the last five years in the best fund, but reduced it to £705 in the worst."
