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UK savers hit by paltry savings interest

UK savers hit by paltry savings interest

Category: Savings

Updated: 15/03/2012
First Published: 15/03/2012

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 It is now over 6 months old so the content may be out of date.

UK savers are missing out on the chance of billions of pounds in interest each year by failing to switch their savings accounts.

A Which? investigation has revealed that Britons could be losing out on almost £13 billion in interest each year by failing to switch savings accounts.

The new figures mark an increase of half a billion pounds since October 2010.

The consumer group is urging savers to ensure they get themselves a better deal and is calling on the Government to ensure the new financial regulator, the Financial Conduct Authority, stands up to banks on behalf of consumers.

Research found that more than four in ten (41%) of the 1,800 savings accounts and cash ISAs available to UK savers are paying 0.5% a year or less, with one in five offering a paltry 0.1%.

Such a low rate pays just a single pound for every £1,000 saved, with the current rate of inflation also further eroding the power of our money.

"Banks and building societies have got away with paying miserable interest on people's hard-earned savings for too long," Which? chief executive, Peter Vicary-Smith, said.

"The message to savers is simple: if your money is in one of these low-interest accounts, you should switch now."

Savers eager to move their money away from low paying accounts can easily do so by using the Best Buy tables.

They include the full range of savings accounts, from no notice cash ISAs to longer term bonds.

Download our free Beginner's Guide to ISAs to find out how to use your 2011/12 ISA allowance. You will need a PDF reader such as Adobe Reader to download this guide.

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