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Elderly losing out from low interest rates

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by David Masters
Elderly losing out from low interest rates

Pensioners have been the hardest hit by the interest rate on savings accounts entering ‘freefall’, Moneyfacts.co.uk said this week.

The price comparison site said an average interest rate of just 0.64% on no notice savings accounts has left pensioners – many of whom rely on savings for a regular income – out of pocket.

Darren Cook, senior analyst at Moneyfacts.co.uk, said: “Low interest rates are geared to encourage savers to plough their savings back into the economy, but this serves little or no benefit to those who rely on interest from their hard earned wealth to subsidise their pension.”

Cook added that the ‘real value’ of savings is currently depreciating at an average rate of 2.24% per year.

In related news, Chancellor Alistair Darling yesterday announced plans to help the elderly in the 2009/10 Budget.

Darling declared that the capital disregard limit on Pension Credit will be increased from £6,000 to £10,000 in November, allowing pensioners to have more money in a savings account without their level of help from the state being reduced.

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News posted: April 23, 2009

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