When was the last time you checked your savings rate? If it wasn’t recently, you might be in for a nasty shock. British savers are missing out on over £12bn in lost interest every year. It’s time to reclaim your share.
Astonishingly, almost half of all UK savings accounts now pay interest of 0.5% or less. And if you think that sounds bad, one in four accounts pay no more than 0.1%. That’s a measly £1 a year for every £1,000 you’ve got tucked away.
Although there’s nothing to stop most people switching out of these awful accounts, the truth is that most banks do everything they can to keep their customers in the dark about the poor rates of interest they’re earning.
Most savings statements do not even include the most basic of information – such as what interest rate you’re earning. And many banks don’t bother to let you know about the better rates that are available through their other accounts.
The great British savings scandal
Over the last few decades, the banks have built the whole savings industry around the idea of tempting you in on high headline rates, and then slowly but quietly cutting them back and hoping you don’t notice.
While the best instant access savings accounts are currently paying close to 3%, the rates on these accounts will all plummet to around 0.5% within 12 months of the account being opened. Thereafter, interest rates will likely be whittled down even further still.
At the same time, the very same banks will be launching new accounts to attract a new crop of unsuspecting customers into their savings trap.
How to get a better savings rate
Which? has been putting pressure on the banks to start being more upfront with their customers, and there’s hope that over the next few years, we will at least begin to see interest rates printed on statements.
In the meantime don’t let yourself be caught in the trap. British savers are collectively losing out on £12bn of interest every year by letting their money languish in poor paying accounts.
Use our new Saving rates booster tool to find out how much interest you’re losing out on, and then take five minutes to switch your money to a better account.
You could earn yourself hundreds of pounds worth of extra interest with next to no effort whatsoever. And you’ll also have the satisfaction of knowing that your savings are working for you, and not for your bank.
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