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84 savings accounts now beat inflation

84 savings accounts now beat inflation

Category: Savings

Updated: 18/02/2014
First Published: 18/02/2014

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 It is now over 6 months old so the content may be out of date.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 this morning, show that the Consumer Prices Index (CPI) fell to 1.9% in January – the first time inflation has fallen below the Bank of England's 2% target since November 2009. And, in more good news for savers, it means there are now 84 savings accounts that can beat it.

In order to counter the effects of tax and inflation, a basic rate taxpayer will need to find a non-ISA account that pays at least 2.38% per annum – and there are currently 84 of them available across the ISA and non-ISA market.

This is a small but welcome increase on the 77 inflation-beating accounts that could be found last month, and a significant improvement from six months ago – in August, when inflation was revealed at being 2.8%, there was just one account that could counter it.

The continued drop in inflation paints a much more positive picture for the nation's savers, however rates are still at record low levels across the board. As Sylvia Waycot, editor of Moneyfacts.co.uk, points out, the average ISA pays just 1.66%, and with a distinct lack of ISA season it doesn't look like things will improve anytime soon.

Although the number of inflation-beating accounts has improved it still might not lead to any measurable returns, unless savers are willing to lock their money away. The fixed rate bond sector is the area which is proving the most fruitful for savers as it's where they're more likely to achieve the 2.38% return needed, so there's still potential to generate a measurable return from your savings.

What Next?

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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 Any products featured may be withdrawn by their provider or changed at any time.

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