Nearly 3 in 5 UK investors would consider Long-Term Asset Funds as government greenlights ISA inclusion

• 57% of UK investors would consider investing in illiquid assets through Long-Term Asset Funds (LTAFs), as Leeds Reforms confirm inclusion in Stocks and Shares ISAs from next year.
• Younger generations are most interested in LTAFs, with over three-quarters of Millennials and 70% of Gen Z open to investing in these funds.
• Educating investors on the benefits of less liquid assets will be key, with around two-thirds more likely to invest in LTAFs if they had a clear understanding of the money management and withdrawal process.

New research from the Investment Association reveals that almost 3 in 5 (57%) UK investors would consider investing in a Long-Term Asset Fund (LTAF), as the government announces their inclusion in Stocks and Shares ISAs from next year as part of the Leeds Reforms.

Unlike traditional funds, LTAFs invest in illiquid assets such as infrastructure, commercial property, or private equity.

The inclusion of LTAFs in Stocks and Shares ISAs will help democratise access to private markets and allow individuals greater choice to invest in assets that will support the UK’s future success, like innovative businesses and infrastructure. These less liquid assets also have the potential to deliver higher returns for investors and will play a crucial role in building a new culture of inclusive investment in the UK.

Younger generations lead the charge

Appetite for investing in LTAFs is highest amongst younger generations. Over three-quarters (77%) of Millennials and 70% of Gen Z would consider investing through the product, compared to just 2 in 5 (41%) Baby Boomers.

In addition, 4 in 5 (80%) Millennials would be comfortable having their money tied up for longer periods if it could generate higher returns, compared to just 65% of Baby Boomers – indicating that LTAFs may appeal more to younger investors with longer time horizons. This bodes well for enabling people to live more prosperous lives in retirement and channeling capital into UK growth and infrastructure projects.

Motivations for investing in private markets

The top motivations for investing in private assets are protecting against inflation eroding the value of savings (76%), portfolio diversification (67%) and superior long-term growth compared to public markets (61%). Almost three-quarters (72%) of investors are comfortable with the idea of having money tied up for longer periods if it could generate higher returns.

In addition, a third of investors consider it important to invest directly in infrastructure projects (38%), in physical buildings or real estate (33%) and in young, unlisted businesses (35%) through a Stocks and Shares ISA.

Getting the right guardrails in place through investor education

Almost two thirds of investors would be more likely to invest in an LTAF if they knew how long withdrawals would take (65%), whilst just over two thirds (69%) would be more likely to do so if they clearly understood how their money would be managed. Any LTAFs marketed to retail investors must be accompanied by clear, consistent and transparent disclosures on risk, liquidity, and fees to enable informed participation.

In addition, almost the same amount (74%) would only commit money to an illiquid fund like an LTAF if they first had a readily accessible cash or liquid savings buffer for emergencies.

Chris Cummings, CEO of the Investment Association, commented:

“Broadening retail investor access to private markets has the potential to both increase individual returns for savers and drive economic growth. We have long called for Long-Term Asset Funds to be incorporated into Stocks and Shares ISAs, and our latest research shows just how transformative this could be.

“The research findings highlight a cautious but growing optimism among UK retail investors towards new investment frontiers. Younger investors in particular value the idea of “going long and going local,” provided the investment opportunities are attractive and fit their financial goals. As we move forward with implementing the Leeds Reforms, educating investors on how vehicles like LTAFs work – including the trade-offs of liquidity vs. return – will be crucial to build trust and uptake. We look forward to continuing our work with government, industry, and regulator to unlock access to private markets, create a culture of inclusive investment in our country, and channel capital into UK growth and infrastructure in the years ahead.”

Notes to Editors

Read the full report here: ISA Barometer Report: Going Long, Going Local

In 2025, the IA again partnered with Opinium to conduct a survey about saving and investing habits in the run up to the 2024/2025 ISA season.

This is the third year that we have conducted the survey and each year we have built on the previous year’s research to better understand the motivations and investing habits of UK investors as they think about their ISA allocations at the end of the tax year.

The data presented in the ‘Going Long, Going Local’ report is based on responses from a survey of 1,000 UK investors (aged 18+). The survey fieldwork took place between 28 February 2025 and 5 March 2025.