Yesterday we revealed how more than half of all cash savers (52%) are unsure how inflation will affect the real value of their savings over time. If this trend continues for the next five years, the total cost of’saver inaction’ in such an environment could be £18 billion[1]. Savers currently have £136 billion in Cash Individual Savings Accounts (ISAs), with average annual interest rates of 0.26 percent[2].

Many savers are unaware that inflation is eroding millions of pounds in low-interest accounts. While keeping some cash in the bank for an emergency fund is essential, savers may want to consider other options to make their money work harder.

Tomorrow we will look at the first of 3 options to consider when it comes to protecting your savings from inflation. However, if you can’t wait that long, get in touch with us and we will be happy to give you the advice you need.

Source data:
[1] This is based on 10,303,247 Cash ISA savers with median savings of £7,231 stalling their investment decision. The total savings amount is projected over five years at a Cash ISA rate of 0.26%, allowing for a 6%, 7% and 8% rate of inflation per annum. This results in an erosion of value of £18 billion, £21 billion and £23 billion over a five-year period.
[2] As at January 2022, average interest rate for instant access Cash ISAs: https://www.which.co.uk/news/2022/01/a-month-on-from-the-base-rate-rise-
have-savings-rates-improved/