Savings habits have been focused on once more as the UK enters the second half of 2021 and coronavirus restrictions are pulled back. New research from Moneyfacts.co.uk warned that while some consumers built up disposable income during the lockdown, there are still those out there with no savings stashed away for emergencies whatsoever.
Rachel Springall, a Finance Expert at Moneyfacts.co.uk, commented on these difficulties.
Ms Springall said: “Building a savings pot for the future is a vital way to avoid short-term credit and instil a positive habit.
“In a low interest environment, it would not be too surprising to find savers apathetic to open an account or chase down a better savings rate, but it’s important that they shake off this attitude and instead seriously consider how they will afford to cover unexpected purchases or a sudden increase in their monthly expenses, such as the cost of the festive season.
“Consumers may have amassed extra disposable income through the UK lockdown but whether this savings behaviour will last over the months ahead is unknown and on the other hand there could be savers who have very little tucked away.
“Indeed, recent research from Yorkshire Building Society revealed that more than a quarter of consumers had less than £500 saved and one in ten had no savings at all.
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“If someone were to put away just £25 a week for the next 20 weeks, they would amass £500 and still have enough time to do their Christmas shopping.
“Those on a low income could open a Help to Save account, which is an initiative from the Government designed to encourage working people on Tax Credits to save.
“The scheme pays 50p per £1 saved up to a maximum bonus of £1,200 over four years. HMRC statistics indicated that more accounts have been opened and deposits rose, which is positive to see, but as part of the same research, thousands of accounts were opened but no deposits were made.
“The financially unstable would be wise to work out their overall household expenditure and where they can cut back and save. There are simple ways to start budgeting, for example by using a free mobile app like Money Dashboard.
For those able or willing to leave their savings untouched, the following accounts were also shared:
Top notice accounts
- Secure Trust Bank 120 Day Notice Account: Gross rate at £1,000 – 0.75 percent
- Shawbrook Bank 120 Day Notice Personal Account Issue 48: Gross rate at £1,000 – 0.72 percent
- Hampshire Trust Bank 95 Day Notice (Issue 8): Gross rate at £1,000 – 0.71 percent
Top regular savings accounts for new customers
- NatWest Digital Regular Saver: Gross rate at £1,000 – three percent variable
- West Brom BS Adult’s Fixed Rate Regular Saver (Issue 4) – 12 Month Term: Gross rate at £1,000 – two percent fixed
- Coventry BS Regular Saver (5) – 12 Month Term: Gross rate at £1,000 – 1.05 percent variable
Top fixed term regular savings accounts for existing customers
- Cambridge BS Loyalty Regular Saver – 1 Year Term: Gross rate at £1,000 – three percent fixed
- Saffron BS 12 Month Fixed Rate Member Regular Saver (Issue 8) – 12 Month Term: Gross rate at £1,000 – 1.5 percent fixed
- Ipswich BS 1 Year Regular Saver (31.05.2022): Gross rate at £1,000 – one percent fixed
Author: Connor Coombe-Whitlock
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