The countdown's on: Last-gasp tips to enhance your ISA allowance

With the final day to park up to £10,680 in a tax-free shelter looming on Thursday, investors are being warned to use the individual savings account tax-free allowance, or lose it.

But you're probably wondering what the big deal is and why it is so vital to use the whole of your tax-free allowance. An ISA allows you to protect your money from the tax collector, so interest generated from your cash will be tax free and any capital gains from your investments will also be exempt from tax.

At a time when interest rates are stuck at record lows of 0.5 per cent, you'll still be wiser to put your hard-earned cash in an ISA, than see it taxed in an ordinary savings account. It means if you are a basic rate tax-payer, you won't get charged the 20 per cent rate on your savings interest in an ISA, and if you pay tax at a higher rate, you won't be hit by 40 per cent tax.

You may be thinking this message of "use it or lose it" is starting to sound like a stuck record, and what difference can a year of saving make? Using your full allowance every year compounds your tax-free savings, helping your money to grow more over the longer term. It could mean the difference between a financially comfortable retirement and one that isn't comfy at all.

"Everyone focuses on how it's so important to put money away and use your ISA allowance, but why is it so important?" says Catherine Penney at Barclays Stockbrokers. "If every year you put money into an ISA, you take it out of the tax bracket. Each year in isolation doesn't have much of an impact but building up a tax-free portfolio over time is crucial."

there is still time to put away your money and consider certain tips to help you maximise your savings. If you are keen to put cash to work in a stocks and shares ISA, but don't know where to invest before the deadline, don't panic.

"A number of stocks and shares ISA providers offer a 'cash park' option whereby your stocks and shares ISA can stay in cash pending investment," says Jason Witcombe at Evolve Financial Planning. "If £10,680 is a lot of money to you, it is not wise to rush the decision on what funds it is invested into. Using the cash facility buys you time and gives you the option of spreading the time over which you put this money into the markets."

But it is important you don't jump head-first into a fund just because the clock is ticking. Although the universe of investment products appears never-ending, you should make a list of key investment criteria to help whittle down the relevant funds, and seek an independent financial adviser if needed. "Choosing a fund that is right for you, not one recommended by a neighbour or a friend, is key," says Philippa Gee, of Philippa Gee Wealth Management.

"Just because a fund is right for someone else, does not mean it is right for you, as the risk may be too high."

If you are keen to invest on an ethical basis, for example, there are certain investments which will be more suited to your needs. "The Jupiter Ecology fund is a good option for ethical ISA investors," says Danny Cox at Hargreaves Lansdown. "The year ahead could be an interesting and potentially rewarding one for ethical investors."

Or, if you have an above-average appetite for investment risk and are willing to experience a potentially bumpy ride, Mr Cox says the Junior Oils Trust could be an attractive offering. "The fund invests in higher-risk smaller companies involved in the oil industry," says Mr Cox.

Another tip for investing to maximise your money is to try to keep costs to a minimum, which means looking at charges. Using lower-cost tracker funds or exchange-traded funds is one way, and leaves more of the market's return in your pocket than with the fund manager.

While it seems there is a lot of decision making for investment ISAs, those with cash ISAs should not just sit back and relax. You need to keep an eye on the rate you are receiving if you want to make the most of your ISA allowance, otherwise your cash could be generating very little bang for your buck.

Even if you can't fill this year's ISA amount, putting in as much cash as possible will still help significantly over the long term. So with four days to go, make sure you use, and don't lose, your allowance.

Emma Dunkley is a reporter at citywire.co.uk

Expert view: Danny Cox, Hargreaves Lansdown

"The Budget has reminded investors of the importance of using their ISA allowance.. Those who are undecided where to invest can still subscribe to an ISA and park their money in a cash trading account, until they are ready to invest. Opening an ISA by telephone or online usually takes less than five minutes but the transaction has to complete by midnight. Last year, some people left it too late and missed out forever."