Savers have been urged to re-evaluate where their money is, as figures show that many accounts are paying well under the market average. Several savings providers have recently announced new, high rates, amping up the competition in the market and giving savers more opportunities to earn interest on the money they stash away.
However, many savers have money sitting in accounts that are earning little or no interest, with their spending power actually declining while inflation goes up. According to the Bank of England, around £303billion of household cash is currently sitting in accounts earning zero interest.
Most savers check balances but not rates
Surveys show that almost all savers check their balances regularly, but far fewer actually consider the rate and look at what else is out there. Saving experts such as Martin Lewis have previously urged Brits to check their rates and make sure they are getting as much out of their savings as they can.
Alex Beavis, interim director of banking at LHV Bank, revealed exactly how much some savers could be losing by not being proactive about their interest rates.
"Just as we swap our summer wardrobe for winter woollies, it's worth doing the same with our savings, switching out old, underperforming rates for ones that will actually keep your money hot through the colder months," he said.
£306 billion earning no interest
"There's currently £306 billion sitting in UK accounts paying no interest at all, according to AJ Bell. Our own research shows why: 95% of savers check their balance regularly, but only 53% are confident their rate is actually competitive, proof we're far better at watching our balance than our rate."
He added: "Left unchecked, that gap has a real cost: a saver with £20,000 in the average easy access account misses out on £2,297 over five years compared with a leading rate."
"This autumn, become an 'active saver': check your rate as regularly as your balance, switch it out if it isn't pulling its weight, and protect your savings (and the interest they earn) from tax by using a cash ISA."
Top-paying cash ISAs right now
According to Moneyfactscompare.co.uk, the top-paying easy access Cash ISA right now is the Trading 212 Cash ISA Promo Rate of 4.81%. Meanwhile, the top-paying fixed-rate Cash ISA, which is more suited to savers comfortable locking away their money without easy access, is the Aldermore 3 Year Fixed Rate Cash ISA with its rate of 5%.
