Savers Watch Rates for Relief from their Plight
For savers believing in their agenda, yet another month has passed with nothing to write home about. With annual inflation stalled around 3.1 per cent, a basic rate taxpayer needs to earn 3.875 per cent before tax just to break even with their savings.
With the Base Rate hitting the low of 0.5 per cent in the first quarter of 2009, and no increase in the near future, savers are having a tough time justifying their plan. Every person’s situation is different but the suggestion from the majority of analysts is; keep doing what you are doing. During times of economic inactivity, it is best to be patient and let time be your ally. Of course, there are better than average deals at different types of banks and lending institutions, if you still want to have access to your money. Then there are bonds, with no access to your money until the term of the bond is up. Interest rates on bonds can vary widely, from 3.5 to 5.5 per cent. The central message here is to keep an eye on the rates of different types of institutions across the board. Also, some analysts suggest putting the money into an account in which the money is untouchable. If it is untouchable, it is definitely unspendable. Since economists across the UK are predicting the base rate to remain at the very low 0.5 per cent, the best thing for savers to o is keep your eyes open and be patient.