Julie Hutchison, Standard Life’s family finances expert, said: “It’s encouraging to see more people becoming switched on the potential of investing through an ISA, particularly those 55 and over.”

“With interest on cash savings still relatively low, investing in the stock market is a good option for those willing to take on investment risk. It could be right for you if you’re aiming to outperform interest from the high street banks and generate more growth and income in return for taking more risk. Although past performance is not a guide for the future, you have to compare the returns from the FTSE All-Share over the last 5 years to average cash savings growth to see the potential upside of stocks and shares investment.”

The number of UK adults 55 and over actively investing in Stocks and Shares ISAs has seen an even greater increase of 45 per cent year on year, according to Standard Life. This compares to a year on year rise of 43% among 35-44 year olds and a 13% rise among people aged 25-34.

Hutchison explained: “Baby boomers who are retiring soon could be planning to invest some of the tax free cash from their pensions. This may account for the higher level of interest shown in stocks and shares ISAs among the 55s and over. But whether it’s a good idea to take money out of your pension and put it in an ISA will depend on individual needs and your personal tax situation. It’s worth seeking professional guidance when retiring or planning your lump sum.”

While the popularity of stocks and shares ISAs is growing, investing in the stock market is still considered too risky by a quarter of those who currently do not invest in such a vehicle. A higher number than average of Brits 55 and over- 35 percent to 27 per cent- admitted to feeling this way.

Standard Life recommended a “risk managed fund”, which provides investors with a diversified portfolio that is managed for you in line with your chosen level of risk, for more cautious investors.