Moneyfacts.co.uk highlights impact of inflation on savings accounts

www.moneynews.co.uk > Banking > Moneyfacts.co.uk highlights impact of inflation on savings accounts

Moneyfacts.co.uk highlights impact of inflation on savings accounts

Thu 14th Oct 2010

Money deposited in savings accounts may not be growing as much as people believe, according to a source at Moneyfacts.co.uk.

Michelle Slade, a spokesperson for the firm, described how savers need to be receiving 3.88 per cent interest from a product in order to maintain the spending power of their capital.

She noted that this figure applies to basic rate taxpayers, with higher rate workers requiring 5.17 per cent interest.

Ms Slade made her comments after inflation figures were announced, with the Consumer Price Index revealed to be 3.1 per cent.

"Inflation continues to antagonise prudent savers who are already struggling to achieve a competitive return on their money," she explained.

In her opinion, it is people who have to rely on returns from their savings who are hardest hit by this trend, which often includes pensioners.

This week, Alliance Trust claimed that 50 to 64-year-olds face an inflation rate of 4.1 per cent, which is the highest of all demographics in the UK.

Click here for more banking news 

Related News : Banking
	Young people 'should be taught to save'
	Families 'should plan for their children's future
	Switching bank accounts 'not as easy as banks portray'
	Brits facing finance difficulties 'should talk to their bank'
	Brits 'should utilise Isa allowances'
	Brits advised on investment options
	Children 'should be given bank accounts at 16'
	Falling inflation 'could help Brits save'
	Money worries 'are mounting for many'
	Contactless payment 'is secure and convenient'