Low interest rates encourage saving, claims expert

| December 11, 2009 | 0 Comments
Low interest rates encourage saving, claims expert

Low interest rates throughout 2009 have helped some people put more money aside into savings, a financial expert has claimed.

Darren Cook, spokesperson for Moneyfacts.co.uk, said low interest rates have decreased mortgage payments for homeowners, increasing their disposable income, which can be used for savings.

“If you look at people that had existing mortgages before the start of the recession, their disposable income has actually increased because the interest rate on the mortgages has actually decreased,” Cook said.

However, Cook also pointed out that people who rely on their savings to supplement their income have suffered from the low interest rates.

Figures published recently by National Savings and Investments (NS&I) showed that the number of people putting money into savings on a monthly basis has increased 2% since 2005.

The amount of money put aside has remained consistent over this period, at about 6% of net income.

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