When COVID shook our world and threatened our financial security, the country’s savers stepped in.
Over £1.7trn was deposited in a series of accounts after a year by April, which saw a dramatic increase in the amount of households up and down the country.
But when the increase in cost of living is 2.5 percent per year and your savings are still giving you back as little as 0.1 percent AER, you know something is off.
Why should all that cash collect dust in a bog standard account when you’ve worked so hard to make it, with its true value being siphoned off all the time?
That’s the reality for millions of savings accounts as the rate of inflation – the measure of the cost of living – continues to rise from its pandemic-induced lull.
And as the Bank of England expects inflation to reach 3 per cent by the end of the year and about 2 per cent next year, it has become increasingly clear that the only way out is to act yourself.
Record numbers of savers have turned to ISA as interest rates on easy-access accounts hit a new low, hoping for potential savings on income tax to provide higher rates.
But it may not always be the smartest move, not least because average ISA rates are currently coming in at as low as 0.56 percent AER, and the amount you can save in any one tax year is limited.
If ever there was a time to start thinking outside the box to help bridge the gap between low average savings rates and rising inflation, it is now.
For starters, it’s worth thinking about how likely it is that you’ll need to access cash quickly. Turn it off, and the rates of return start rising.
At the time of writing the best easy-access savings accounts on the UK market, including the ISA, were offering 0.50 percent AER in interest. But even put your cash aside for 12 months and you can watch your rewards grow by up to 0.95 percent AER, with a year’s worth of accounts accessed through Raisin UK’s free online marketplace of major banks and building societies. is.
This is significantly higher than the one-year best ISA rate, which currently comes in at 0.61 per cent AER.
It’s the same story with long-term fixed rate accounts. For example, the flagship two-year fixed rate ISA account is offering only 0.85 percent AER, while the one through Raisin is offering 1.10 percent AER. Fix for five years with Raisins and today’s best deals come at 1.25 percent AER.
The knowledgeable saver has other weapons in its arsenal as well. Most savers still default to their local bank or building society, but limiting yourself to a specific high street provider means missing out on deals on offer elsewhere.
With more banks from across Europe at your fingertips, Raisin UK gives you access to a wide range of options to help you find the best savings account for your individual circumstances.
But keeping a close eye on your cash doesn’t mean you have to grapple your way through a huge number of new websites and endless new login details. Raisin UK’s simple online platform and app allows you to easily and at any time manage your money with all your accounts under one roof.
And since banks on our Marketplace allow you to make FSCS-protected deposits up to £85,000 per person, per banking group, you can make it even harder to get more of your money.
This is especially true if you take advantage of us£100 welcome bonusAvailable to new customers till July 30.*
Register for free Register www.raisin.co.uk and see our ISA-beating rates
*Welcome Bonus – Minimum deposit £5,000 (for easy-access accounts, the minimum balance must be above £5,000 for the first six months). The term or duration of your account must be six months or more. Raisin UK is a trading name of Raisin Platforms Limited which is authorized and regulated by the Financial Conduct Authority (FRN: 813894). Raisin Platforms Limited is registered in England and Wales, number 11075085. Registered Office: C/o Withers LLP, 3rd Floor, 20 Old Bailey, London, United Kingdom, EC4M 7AN. The information on this page does not constitute financial advice, always do your research to make sure it is right for your specific circumstances. Tax treatment depends on each customer’s individual circumstances and may be subject to change in the future.