Think carefully before fixed-rate savings investments, says uSwitch

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Think carefully before fixed-rate savings investments, says uSwitch

Wed 30th Sep 2009

People should look at the details of fixed-rate savings accounts before deciding to put their money into them, uSwitch has advised.

Rumina Hassam, savings expert at the company, made her comments following the release figures by uSwitch, which indicate that £131 billion in savings has been locked away in fixed-return accounts in the past 12 months.

She pointed out these accounts can offer competitive interest rates, but nearly half of the products of this type do not allow people to access their money for a minimum period of time.

This can be hard for people during tough economic times, as they will be charged by their bank for withdrawing cash.

"The devil really is in the detail as far as fixed-rate savings are concerned. Even if consumers are allowed to make withdrawals, the extra interest earned could be completely wiped out," she explained.

Recently, uSwitch reported that if over-50s used their extra Isa allowance - which comes into effect on October 6th - they can earn £677 million extra in interest throughout the year.

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