Savers love Cash ISAs – but their safety comes at a price
Savers love the safety of Cash ISAs, overwhelmingly preferring them to their riskier but more lucrative investment ISA rivals.
Around 14.5m people now have a Cash ISA, compared to 4m with a Stocks and Shares ISA, according to figures from HM Revenue & Customs (HMRC).
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However, according to savings experts Moneyfacts, the average Stocks and Shares ISA has returned 9.64 per cent per annum over the past 10 years, compared to just 1.21 per cent for Cash ISAs.
According to figures from HM Revenue & Customs (HMRC), 7.8m people opened a new cash ISA in the 2022/23 tax year, compared to 3.8m who opened investment ISAs.
Savers added £41bn to Cash ISAs during the period, while investors put £28bn into Stocks and Shares ISAs.
The year before, 7.1m savers picked a Cash ISA, while 3.9m opted for a Stocks and Shares ISA.
In 2021/22, Cash ISAs held £30.9bn, compared to £28bn in Investment ISAs.
However, savers with Investment ISAs tend to put more into their tax-free savings pots.
In 2022/23, the average Stock and Shares ISA had £7,355 invested in it, compared to £5,296 for the typical cash ISA.
Moneyfacts finance expert Rachel Springall said: “Those now considering a Stocks and Shares ISA would be wise to keep in mind that past performance is never guaranteed to be reflected in future returns. Indeed, the significant rise in stock markets over the last year may not be sustained and could fall back.”
Men tend to prefer Investment ISAs, while women favour their cash rivals.
The most recent HMRC figures show that around 2.7m men subscribed to Cash ISAs in the 2021/2022 tax year.
This compares to 3.7m women.
With Investment ISAs, 1.9m men held one compared to 1.4m women.
Research from the Building Societies Association (BSA) in February 2025 suggested that Cash ISA savers pick these deals with the safety of their money in mind.
The BSA found that 90 per cent of Cash ISA subscribers wanted to get back at least the amount they had saved or invested, a guarantee that only regulated cash savings pots provide.
Two-thirds (67 per cent) of Cash ISA savers said they knew about Stocks and Shares ISAs, while another 30 per cent had never heard of them.
BSA chief executive Robin Fieth said: “Cash ISAs form an important part of individuals’ savings plans, and it’s clear that many people are making a conscious decision to save in cash rather than stocks and shares.”