Cash-heavy portfolios expose savers to inflation erosion, with £10,000 losing 40% purchasing power since 2016. A pension fund manager warned that holding cash is a “most dangerous holding” at a client meeting, sparking renewed debate about risk aversion in UK savings. While 2% annual returns in cash ISAs lag behind property (£16,800 vs. £12,200 over a decade) and global equities (£33,300), 67% of ISA savings flowed into cash products in 2023-24.

Savers withdrew £10.57bn from equity funds in mid-2025, prioritizing safety over growth.