With recent reports highlighting a rise in the cost of living, potential first-time buyers are finding it more difficult to save for their deposits.
Whilst the average age of a first-time buyer is 29, research from Sainsbury's Finance reveals that 16% of people aged 25 - 34 are saving less than they were a year ago, with the main reason for this being the rising cost of living. Only 9% are saving more. In addition to this, 36% claim that they currently are not able to save anything.
Neil Cameron, Savings Manager, Sainsbury's Finance said: "First-time buyers need to have a larger deposit that they did a year ago - in some cases as much as 25% as many mortgage lenders continue to restrict their deals, so those looking to get onto the property ladder need to be saving more not less. Despite this, our research suggests that more people in the first-time buyer age group are now saving less.
"Those people saving for a deposit on a property should review any savings account they are using for this and make sure that they have one that pays a consistently attractive rate that does not penalise you for withdrawing your money should you need to."
The Sainsbury's Internet Saver account pays 5.75% AER on balances from £1. The rate does not depend on an introductory bonus and does not restrict the number of withdrawals they can make from their account.
Since its launch in January 2005 Sainsbury's Internet Saver has consistently paid a competitive rate, and was ranked number one easy access internet savings account by Moneyfacts in its new 36-month consistency rankings, Trust It award, which tracks the rates paid by savings accounts for the past three years.
This award is backed up by analysis from Defaqto that reveals that Sainsbury's Internet Saver is the only instant or easy access savings account generally available to adults that has consistently paid a gross AER interest rate on a balance of £1 that is equal to or above the Bank of England base rate in each and every month since January 2005.
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