Almost half (47.9%) of all money paid into UK ISAs is now put into stocks and shares ISAs, up from 33.2% in the previous year and the highest level since the Global Financial Crisis, says Bowmore Financial Planning.
£33.8bn has been paid into stocks and shares ISAs in the past year*, up from £24.2bn the previous year. At 47.9% of the total amount put into UK ISAs, this is easily the highest percentage in share-based ISAs since 2008/09, when only 24.2% was invested in stocks and shares ISAs.
The amount of money put into cash ISAs now accounts for just 52.1% of all money paid into UK ISAs. This is down from 66.8% last year and has consistently fallen since hitting a record 75.8% in 2008/09. Around £36.8bn was paid into cash ISAs in the past year, down a quarter from £48.7bn the previous year.
Gill Millen, Managing Director of Bowmore Financial Planning, says: “It’s good to see the message getting through that people saving for the long-term should put their money to work in the stock market, rather than let it waste away in cash.
“While this is a step in the right direction, more needs to be done to encourage people to invest, particularly if they are saving for long-term goals like retirement.
“Investors should remember to look past short-term volatility in the market and understand that over the long term, the return from the stock market beats cash over any medium to longer term time period.
“It will be interesting to see if the rise in interest rates has an effect on the number of cash ISAs this year – superficially cash ISAs will be more attractive as their nominal interest rates have increased.”