Many may face disappointment as just 8% realise that the new Lifetime ISA is only available to people under 40, research found.

Over half of over 50s surveyed said the ISA rules were too complex and there were too many different types available.

The Saga Investment Services study showed just 14% of over 50s knew that Cash ISAs were available to people over 16, with one in five saying they didn’t know who could open one.

While a third of people knew that an investment ISA was available only to over 18s, a quarter were unaware who could open one. There was more confusion over innovative finance ISAs, introduced last year, as 51% said they had no idea who could open one.

Half of over 50s were not aware that it is possible to transfer Cash ISAs into investment ISAs and vice-versa and half were not aware of the requirement to transfer between ISA providers – rather than closing and reopening a new one – in order to preserve the tax free status of the savings with it.

Differing terminology amongst ISA providers could also have been adding to the confusion, the report stated, with just six in ten over 50s knowing that Investment ISAs and Stock and Shares ISAs are different labels for the same type of account.

Nici Audhlam-Gardiner, managing director, Saga Investment Services, said: “So many changes have been made to the ISA system over recent years that people are struggling to understand the rules.

“We are in danger of every good idea resulting in a new type of savings plan and in doing so we end up with a Heath Robinson savings model. So we are calling for a wholesale simplification of savings - one ISA account for all ages, the same terms and benefits for any purpose.”