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Why now is the moment to help clients move from cash to stocks and shares
For more than 25 years, ISAs have been central to the UK savings landscape — yet our latest research reveals a striking disconnect between how people save and how they could be growing their wealth. While 51% of UK adults in our sample held a Cash ISA, only 27% held a Stocks & Shares ISA, despite the fact that most ISA wealth sits in investments rather than cash.
As advisers, this presents a powerful opportunity. The data shows millions of consumers are sitting in cash unnecessarily, often through lack of understanding, misplaced caution, or simple inertia. By helping clients understand the long‑term limitations of cash and the potential benefits of Stocks & Shares ISAs, you can play a critical role in improving financial outcomes.
Below, we explore the key insights from the research (Royal London – The ISA landscape, October 2025) and what they mean for your conversations with clients.
1. Cash remains the default - even when it isn’t the best option
The ISA market reached £725.9bn in 2022–23, with 59% of assets held in Stocks & Shares ISAs. However, the majority of new ISA subscriptions still flow into cash. This means clients are saving rather than investing, even when they may have the risk capacity and time horizon to benefit from market growth.
The research highlights three important patterns:
Clients underestimate the risk of cash
Many people still see cash as ‘risk‑free’, without recognising the long‑term erosion from inflation. As inflation risk is less visible than market volatility, consumers overestimate the safety of cash while underestimating the opportunity cost.
Women and lower‑income clients are more likely to stay in cash
Only 12% of those earning under £20,000 hold a Stocks & Shares ISA, and significantly more women than men cite lack of understanding or fear of loss as reasons not to invest. This suggests advisers can add real value in building confidence among these groups.
Younger adults are more open to investing than older ones
Only 21% of 18–34s said ‘nothing could persuade’ them to move some Cash ISA savings into investments, compared with 48% of 50–69‑year‑olds. For advisers with younger client bases, there is a strong opportunity to reinforce long‑term habits early.
2. Clients are missing out on significant growth potential
Our research contains one of the clearest illustrations of why long‑term investing matters: the comparison of Cash ISA returns with Stock & Shares ISA returns over 1, 3, 5 and 10 years.
Over 10 years, a typical Cash ISA grew by 10.4%, compared with 206.3% for a Stocks & Shares ISA (after a 1% AMC).
On a £1,000 investment:
- Cash ISA after 10 years: £1,103
- Stocks & Shares ISA after 10 years: £3,063
This data gives advisers a compelling, evidence-based way to illustrate the long‑term cost of remaining in cash — particularly for clients saving for retirement, long‑term goals or intergenerational wealth planning.
3. Lack of knowledge is the biggest barrier — not lack of appetite
Across the research sample:
- Over half of adults hold no investments at all.
- The most cited reasons are ‘not enough money’, ‘fear of losing money’, and ‘lack of understanding.’
- Among Cash ISA holders, 39% said better returns could persuade them to invest — yet 40% said nothing would.
What’s clear is that many people could be persuaded to invest but lack the confidence and clarity to take the first step.
Confusion about tax benefits is widespread
The study found:
Only 40% knew that withdrawals from a Stocks & Shares ISA are tax‑free.
Only 34% correctly stated that gains in a Stocks & Shares ISA are tax‑free.
Even among Stocks & Shares ISA holders, 29% incorrectly thought gains were taxed.
This is one of the most immediate areas advisers can address: demystifying ISA tax rules and clearly explaining the advantages of tax‑free compounding.
4. Stocks & Shares ISAs align well with long‑term goals
One of the most encouraging findings is how people already use Stocks & Shares ISAs:
- 49% say they use them to save for retirement.
- 27% use them for unexpected bills (suggesting some need help aligning goals and liquidity planning).
- Those with £50,000+ in savings or investments are far more likely to use Stocks & Shares ISAs for retirement planning (57%).
This aligns closely with the advice process. Helping clients match objectives with investment horizons naturally leads to clearer conversations about moving beyond short-term cash holdings.
5. Adviser influence makes a measurable difference
A critical insight from the research is that financial advisers remain the most trusted and most influential source of ISA guidance:
- 30% opened a Stocks & Shares ISA after receiving advice — more than any other information source.
- 26% transferred based on adviser recommendation.
- ISA holders who used advisers were significantly more aware of transfer rules, tax benefits, and investment features.
Clients value advisers for:
- Expert knowledge (52%)
- Simplifying the process (24%)
- Considering the full investment picture (12%)
People who used an adviser to transfer their ISA showed much greater product knowledge than those who used an adviser simply to open one — suggesting deep, ongoing conversations create more engagement than one-off transactions.
6. A clear opportunity: Supporting clients who hold too much cash
The research shows a large pool of clients who could benefit from your guidance:
- The FCA estimates 8.6 million people hold over £10,000 in investible assets in cash.
- Four in ten Cash ISA holders say nothing would persuade them to switch — but six in ten could be persuaded.
- And among those who could be persuaded, the three biggest motivators are:
- Better returns than a savings account
- Returns above inflation
- Diversification opportunities
This aligns directly with your role as an adviser: providing reassurance, education, and a personalised plan that balances risk, time horizon, and client goals.
How you can turn insight into action
Start with the risk conversation - but broaden it
Many clients equate risk solely with volatility. Helping them understand inflation risk, opportunity cost, and sequencing risk can reshape their perspective.
Use real data to demonstrate value
The historic comparison of cash vs. equity-based ISA returns over 10 years is an exceptionally strong illustration of why long‑term investing matters.
Focus on tax efficiency
Clients often don’t realise gains, income and withdrawals are all tax‑free in a Stocks & Shares ISA — and many don’t understand the diminishing relative value of Cash ISA tax benefits after the introduction of the Personal Savings Allowance.
Reassure through planning and diversification
The research shows that clients fear losing money, but diversification and long-term investment frameworks can give them the confidence they need.
Make transfers simple
Most people know transfers are allowed, but understanding of the rules is weak. Your guidance removes friction and opens the door to better outcomes.
Our research highlights a clear truth: millions of people are saving diligently, but not necessarily wisely. Cash ISAs have an important role in short-term planning and emergency funds — but beyond that, they can limit financial growth.
For advisers, this presents a real opportunity. By helping clients understand the long‑term benefits of Stocks & Shares ISAs, you can guide them toward decisions that build resilience, grow wealth, and make their money work harder — all while deepening adviser‑client trust.
