Despite the pandemic, 2021 product sales figures suggest that investment and pensions did surprisingly well as investors used spare time and cash to invest in tax efficient products.

ISA sales nearly doubled from 389,674 to 769,247 during the year and SIPP sales leapt by 15% year on year, up from 740,418 plans in 2020 to 851,963 in 2021.

Pension income drawdown continued to be a mainstay for pension savers with 218,100 people entering drawdown in 2021, up 21% from 180,654 in 2020.

Annuity sales also rose by 7% year-on-year, from 41,293 to 44,161.

AJ Bell, which analysed the figures (Retail Investments Product Sales Data dashboard, said that while many were hit financially by the pandemic there were also millions of "accidental savers" in employment who found more money left in their bank accounts each month as entertainment and holidays became unavailable.

Tom Selby, head of retirement policy at AJ Bell, said: “During the peak of the pandemic and subsequent national lockdowns, millions of ‘accidental savers’ fortunate enough to remain in employment saw their bank balances bolstered as spending on things like going out and holidays plummeted.

“These accidental savers were undoubtedly one of the key driving forces behind a near-doubling of ISA sales from 2020 to 2021. The first quarter of 2021 was particularly eye-catching, with almost 300,000 ISAs bought during that three-month period alone.

“The world has of course moved on significantly since the turn of the year, with millions of Brits now facing up to a cost-of-living crisis which is squeezing their ability to spend and save for the future.”

Despite bad publicity in recent times, SIPPs continued to grow as a popular pension option. AJ Bell, which offers SIPPs, said that with SIPP sales up 15% year-on-year they were “comfortably the most popular product among retail retirement savers.”

AJ Bell believes the rising popularity of SIPPs is reflected in the retirement income market, with drawdown now firmly established as the "dominant" option. 

The company said that stronger markets during 2021 encouraged more people to stay invested and use drawdown for retirement income but it believes that will be tested by the Russian invasion of Ukraine and the global economic issues that is causing.

The firm added that annuities remain viable but sales in 2021 were lower than 2015 just over 44,000 new plans sold, up 7% compared to 2020. Recently annuity rates have begun to increase but AJ Bell said it did not expect major growth in annuities to return.