UK households with £10,000 or more in savings are being urged to check where their money is held, as they could be losing out on hundreds of pounds a year in interest. New figures from MoneyfactsCompare.co.uk show that interest rates on bank accounts vary widely, from just 1.16% up to 4.22% at the best building societies.
Someone holding £10,000 in a typical 1.16% account would earn £116 a year in interest. The same £10,000 would generate £422 in a 4.22% account, a difference of £306 across a year. With inflation currently tracking at 3.1%, savers are actively losing money unless they beat that rate, as the value of cash deteriorates by 3.1% a year.
Building societies pay billions more in interest
Caitlyn Eastell, Personal Finance Analyst at Moneyfactscompare.co.uk, said: “Savers could be missing out on hundreds of pounds simply by leaving their cash in a lower-paying account. UK Savings Week is a great opportunity for savers to review where their money is held, because the difference between savings rates can have a significant impact on returns over time. In 2025, building societies paid savers an additional £2.1 billion in interest compared with the average rate offered by the largest banks, highlighting the important role they play in driving competition.”
Eastell added: “A typical big bank easy access account pays just 1.16% whereas the top rate building societies pay 4.22% on average. On a £10,000 balance held for a year this equates to a meaningful £306 difference. The impact becomes even more important when inflation is considered.”
Check rates regularly to protect cash value
“Savers who remain loyal to uncompetitive accounts risk seeing the real value of their cash eroded over time. At a time when households are under pressure, improving savings outcomes is not always about putting more money away each month. It can be about saving smarter by making sure their cash is earning a competitive rate,” Eastell said.
“Building societies continue to play an important role in the savings market, frequently offering competitive returns and rewarding savers that are proactive with their cash. Just because a balance is growing on paper, it doesn’t always mean savers are better off in real terms. To avoid missing out, savers should compare rates regularly across the whole of market, and switch to a more competitive deal if they find their hard-earned cash isn’t being rewarded.”
