Savers’ best interest in current accounts
One in five savers now keep their money in a current account because they are unable to find a better rate of interest elsewhere, new research has revealed.
Twenty one percent of those polled in the Post Office survey said a current account is now their best option, compared to 32% saving in a cash ISA, and 44% using a savings account.
Figures from the Bank of England support those keeping their money in a current account, with the average return on instant access savings accounts at just 0.51%, whilst current accounts can offer returns of up to 6%.
Over half of people asked agreed that we are currently going through the ‘worst time ever’ for savers.
Thirty six percent of Brits are not saving at all, the study found. The worst savers are 35-55 year olds, with 48% of this age group not saving.
Of those not saving, half hope to start once they have paid off debts, whilst one in ten say they will start by the end of the year or when the economy improves.
Richard Norman, Post Office director of savings, said “Despite many people believing now is the worst time ever for savers, it is encouraging to see that 61 per cent of people are continuing to save.”
Norman said that savers should proactively search for the best interest rate.
“Savers need to take extra care of their money by choosing a home for it wisely,” he warned.
“There are hundreds of poor paying accounts, so people need to make sure they avoid them.
“Worryingly, only 23 per cent of those surveyed say that they have been proactive in looking for a good savings deal.”