UK savers could be missing out on a massive £9.4 billion a year by failing to check the interest rate paid on their savings account and switching to a better deal according to comparison site,
moneysupermarket.com, which is urging all savers to check their rates regularly and take action to ensure their money is working as hard as possible for them.
Research by the comparison site has found that apathy among savers is increasing, with 36 per cent of all savers never having checked their savings rate, (up from 31 per cent last year) despite holding their accounts for an average of seven years.
What's more alarming says
moneysupermarket.com is that over half (57 per cent) have never switched savings accounts in order to get a better deal. As a result, savers are missing the opportunity to gain the maximum return on their savings pot, which could be worth up to an extra £245 a year on £10,000 saving, or £1,715 over seven years.
Savers who have not checked their rate will most likely have money languishing in discontinued accounts that are no longer available to new customers, says
moneysupermarket.com.
The comparison site says the average rate for discontinued accounts among the main high street savings providers is 0.3 per cent AER. Of those who have checked the interest rate since taking out their account, 41 per cent have been disappointed to find that their rate had gone down.
"We have seen a year on year increase of people not checking their savings rate, with over a third failing to ever check their current deal said Kevin Mountford, head of banking at
moneysupermarket.com.
“Our findings also show a third of savers (30 per cent) opened their account over ten years ago, but when it comes to savings, loyalty does not pay, and these customers are most likely getting a raw deal on their savings.
“Generally speaking, if you opened a savings account over 12 months ago, you will probably find the account will now be paying a much lower rate that you signed up for.
"Clearly many savers are reluctant to shop around for the best rate; a quarter don't feel that it's worth switching in this low rate environment, and 19 per cent cannot be bothered to switch their account.
“However, getting a good deal on your savings doesn't have to be a headache and not every saver will want to continually chase the highest interest rate available.
“For those that want to switch to a good deal and remain on it without running the risk of bonuses or withdrawal penalties, there are a number of accounts on the market that have performed well since Base Rate dropped to 0.5 per cent, making it easier for customers to keep an eye on their rate.
"Whatever product you opt for, our research highlights precisely why it’s so important that savers be proactive in checking their rates, as they are likely to be missing out on a large amount of interest.
“Remaining apathetic at this time plays into the hand of the banks and will cost consumers dearly in the long run.
"Banks are reluctant to inform customers of rate changes, so the onus should always be on the customer to ensure they are getting the best deal.
“We encourage all savers to get online or call their bank to find out what rate they are currently on, then search for the best rate available and switch as soon as possible to avoid any further loss of income."
Top 5 Easy Access - Based on £10,000
|
Provider
|
Account
(Terms & Conditions Apply)
|
Minimum Deposit
|
AER
|
|
The AA
|
Internet Extra
|
£1
|
2.80 per cent
|
|
ING Direct
|
Savings Account
|
£1
|
2.75 per cent
|
|
Tesco Bank
|
Internet Saver
|
£1
|
2.75 per cent
|
|
BM Savings
|
Telephone Extra
|
£1
|
2.75 per cent
|
|
Sainsbury's Finance
|
Easy Saver
|
£1
|
2.70 per cent
|
Sourced by www.moneysupermarket.com 22.07.2010
Most Consistent Accounts over 12 months (without bonuses)
|
Provider
|
Account
(Terms & Conditions Apply)
|
Minimum Deposit
|
AER
|
|
Intelligent Finance
|
iSaver
|
£1
|
2.49 per cent
|
|
Stoud & Swindon BS
|
Postal Account
|
£1,000
|
2.25 per cent
|
|
AK Bank
|
Savings Account
|
£1
|
2.25 per cent
|
|
Yorkshire BS
|
Internet Saver
|
£1
|
2.10 per cent
|
|
BM Savings
|
e-Saver
|
£1
|
1.85 per cent
|
Sourced by www.moneysupermarket.com 27.07.2010
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