116 savings accounts now beat inflation - Savings - News - Moneyfacts

News

116 savings accounts now beat inflation

116 savings accounts now beat inflation

Category: Savings

Updated: 25/03/2014
First Published: 25/03/2014

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The latest official inflation figures, released earlier today, show that the Consumer Prices Index (CPI) fell to 1.7% in February – meaning it's the second consecutive month that UK inflation has fallen below the Bank of England's 2% target. And, in even better news, it means savers can now find 116 accounts that will beat it.

In order to counter the effects of tax and inflation, a basic rate taxpayer will need to find an account that pays at least 2.13% per annum – and there are currently 116 inflation-beating accounts available across the ISA and non-ISA market, made up of 37 bonds and 79 cash ISAs.

This is a welcome increase of 34 on last month when there were just 84 accounts that could counter the effects, and a significant improvement on a year ago when just five accounts – all of them cash ISAs – could do the same, thanks to inflation being at 2.8%.

The continued drop in inflation paints a much more positive picture for the nation's savers, although unfortunately rates are still at record low levels – and are still falling. As Sylvia Waycot, editor of Moneyfacts.co.uk, points out, the average ISA pays just 1.65%, a drop of 0.01% on last month and considerably less than a year ago when it was 1.78%.

However, she's urged savers not to turn their back on ISAs altogether, adding: "ISA interest is free from tax and as such each year's allowance should be utilised to the full as you can't reclaim any lost years, and future rates may look very different from our current hard times."

It still pays to make the most of ISAs and of your savings as a whole, and if you're willing to put your money in fixed rate accounts you could well achieve the 2.13% needed to generate a measurable return.

What Next?

Find an inflation-beating savings account

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Savings being used as a festive financial buffer

Good news from RCI Bank UK – its latest research shows that many of us are saving more than we were a year ago, but the question is, will you be dipping into that buffer to cover the cost of Christmas?

6 of the best easy access savings accounts

Easy-access savings accounts are as simple as they sound – they allow you to access your money whenever you need it, without having to give advance notice, and they also allow you to pay into them at any time. Here are six of the best.

Start saving for Christmas… 2017!

Christmas is just around the corner and our annual festive splurging is starting to step up, but are you prepared? It may be too late to start saving for this year’s festive spend, but it’s never too early to start for next year’s!
 
Close