British savers lose £12 billion a year
December 15, 2010 at 10:28 am
Savers in Britain are losing an estimated £12 billion every year simply because they are keeping their savings in bank accounts with very low interest rates rather than moving them to accounts paying higher rates.
The news was revealed by Which?, after a survey was conducted into the nation’s saving habits.
£12 billion in interest a year is equal to £322 per saver being lost in interest. If only the nation’s savers were putting their money into higher-rate savings accounts then they would be this much better off every year.
Which? discovered a bleak picture when it came to savings rates across the UK. It found out that of the 1,200 savings accounts in the UK, nearly half pay just 0.5% or under for a balance of up to £5,000. On top of that, it also found that one in four accounts pays 0.1% or less.
The 0.5% base rate is partly to blame, but Which? claims that banks should also be doing more to inform their customers of the different rates on offer to allow savers to see quickly how much they could be making in interest if they switched their money. Some of the instant access top rates are 3%, with 4.5% interest rates possible for long-term savers.
Of all the banks in the UK, Santander performed the worst for low rates, with 29 out of its 53 accounts paying 0.1% or under. Barclays had the highest proportion of low-interest accounts, with two thirds only paying 0.1% or under.
The advice is, as always, to shop around and find the best rates that you possibly can if you want to make your savings go further.
