The number of individual savings accounts (Isas) in operation rose to 14.2 million in 2008/09 – an increase of 53% on when they were first launched in 1999.
According to research from Halifax, the number of people under 25 saving in an Isa has grown by 88% over the past nine years. Some 1.14 million young people now subscribe to Isas, which currently allow people to save up to £7,200 or a year tax-free, or up to £10,200 a year for the over 50s.
In addition, Halifax’s data shows the popularity of Isas is growing most quickly among female savers. Although the number of men with Isa savings continues to exceed the number of women who subscribe to them, the ‘gender gap’ was just 1% in 2006/07. This compares with a 14% difference in 1999/00.
Cash Isas and stocks and shares Isas
The value of cash Isa savings has also grown dramatically since they were first introduced, Halifax says. The amount saved in cash Isas has increased from £12.3bn in 1999/00 to £169.5bn in December 2009.
Cash accounted for 58% of the value of all Isa savings in 2009, while 42% of savings were held in stocks and shares Isas.
This contrasts sharply with the situation in 1999/00, when stocks and shares accounted for 90% of all Isa funds.
Find the best Isa for you
With around six weeks left of the current tax year, now is the time to ensure you have taken advantage of your full Isa allowance.
Remember: if you were born on or before 5 April 1960, you are currently able to save up to £10,200 in Isas during 2009/10. Up to £5,100 of this can be placed in a cash Isa, but if you choose to you can save the full £10,200 in a stocks and shares Isa. These new limits will apply to Isa savers of all ages from 5 April.
To find a competitive cash Isa rate, check out the Which? Best Rate review. We feature instant access Isa accounts, fixed-rate cash Isas and also provide details of accounts that have remained consistently competitive over the past three years.
Meanwhile, if you’d like to learn more about stocks and shares Isas, read our free Stocks and shares Isas explained advice guide.
Which? Money when you need it
You can follow @WhichMoney on Twitter to keep up-to-date with our Best Rates and Recommended Provider product and service reviews.
Sign up for the latest money news, best rates and recommended providers in your newsletter every Friday.
Or for money-saving tips, and news of how what’s going on in the world of finance affects you, join Melanie Dowding and James Daley for the Which? Money weekly money podcast
For daily consumer news, subscribe to the Which? news RSS feed here. And to find out how we work for you on money issues, visit our personal finance campaigns pages.