New statistics from HM Revenue & Customs have shown the accumulated value of stocks and shares Isas (Individual Savings Accounts) to be higher than the value of cash Isas.
Provisional figures for 2009-10 revealed savings in stocks and shares Isas were worth £178bn, with £172bn held in cash Isas. This equates to a 53% rise in the value of stocks and share Isas, and is said to be a reflection of last year’s increase in stock markets.
The findings are a stark contrast to the situation of two years ago – in 2008/09, savings in cash Isas were worth £143bn, compared with just £79bn held in stocks and shares.
Current cash Isa rates low
Savings held in cash Isas – currently paying an average interest rate of 1.65% – went up by just 9% from last year’s figures. Cash Isas are held by about a third of the UK’s adult population. In April this year, the amount people could save in an Isa every year rose from £7,200 to £10,200, of which half can be saved in cash and half, or all, in stocks and shares.
The new government figures still contrast sharply with the picture a decade ago when Isas began – in 1999/00 stocks and shares accounted for 90% of all Isa funds. Today’s figures for stocks and shares investments also include the value of ex-PEPS (Personal Equity Plans), which automatically became stocks and shares Isas in 2008.
Find the right Isa for you
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 details of accounts that have remained consistently competitive over the past three years.
For much more about stocks and shares Isas and whether they are suitable for you, read our stocks and shares Isas explained advice guide.
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