The amount of people subscribing to a cash ISA in the 2017/18 tax year has hit its lowest point since 2001/02, according to new figures from HMRC.

The year-on-year drop of nearly 700,000 accounts comes following a period of rock-bottom cash ISA rates – at the time of publishing, the best cash ISA rate you can get for a one-year fixed term is 1.61% – made all the more frustrating for savers by the high levels of inflation seen in recent years.

A second year of the personal savings allowance is also likely to have contributed to the decline, with fewer savers now required to open an ISA to keep all their savings earning interest tax-free.

Stocks & shares ISA and IFISAs see a rise

On the flip side, stocks & shares ISAs and Innovative Finance ISAs (IFISAs) both achieved their highest ever numbers of annual subscriptions (although the IFISA has only been available since April 2016). While cash ISAs still account for a majority of the ISA market, it could suggest a shift among ISA subscribers towards taking risk with their tax-free money, in order to try and target inflation-beating returns.

That said, the uptick in stocks & shares ISAs and IFISAs has done little to return us to the heyday of 2015/16, which saw total ISA inflows of £80 billion. The following tax year, cash ISA subscriptions plummeted by about a third to just under £40 billion, and have yet to recover.

Source: HMRC

It begs the question, where has all that ISA money gone? Is it possible people are letting their ISA allowance go to waste?

Investment ISAs of course aren’t right for everyone, though. For a closer look at your options, take a look at our comparison blog: What different types of ISA are there? And what's the best ISA for me?