Saving important to safeguard against inflation

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Saving important to safeguard against inflation

Fri 29th Jan 2010

Savers should be looking to find a way of putting some cash to one side for a rainy day, in the view of one industry expert.

David Kuo, director of financial website The Motley Fool, believes that rather than doing nothing, consumers should be looking to safeguard some of their cash in a savings account.

"If interest rates were to rise and you couldn't cope with the higher payments that come, at least you have your nest egg somewhere," Mr Kuo advised.

However, he warned against not doing anything at all with your money, as inflation will eat away at it when it as it rises. Instead, consumers should look to invest their funds or use it to pay off debts.

His comments follow a report from Barclays which revealed that there has been a 20 per cent drop in the cost of paying back a mortgage in the last year, meaning many people have extra cash in their pockets.

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