A quarter of people only check interest rates when opening an account
Average saving account held for ten years
Saga offers a competitive 5-year fixed rate saving account at 5.00% AER
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Despite the serious issue of lack of income in the current environment, and widespread belt-tightening, research* by Saga Personal Finance has revealed that Britons are doing little to make the most of their savings, with almost two thirds (61%) admitting to not even knowing the rate of interest on their accounts. The over 50s are savvier at knowing their current rates, with almost half (49%) aware of them, in contrast to over two third (68%) of the younger generation who don’t, but the lack of awareness is still acute.
Worryingly, a quarter (24%) of people only check interest rates when opening a savings account, and a further 25% check them once a year or less. With the Bank of England rate unlikely to move anytime soon, many people could be missing out on better deals and much needed income.
Apathy to switch accounts is high, as the average life expectancy of a savings account is almost ten years (9.1 years). Women are shown to be less loyal than men to their accounts (8.8 years vs 9.3 years), but still do not make the most of their ability to switch to better rates on the market.
Fixed rate products, offer savers the peace of mind that they are getting a good rate that will not drop after a few months when the account is no longer front of mind. Savers are also prompted to act when the term ends to shop around again for a competitive rate. Saga offers a five-year fixed rate saving account with an attractive rate of 5.00% AER. The rate is fixed for the product term and customers can have access to their money subject to 90 days loss of interest on the amount withdrawn.
Surprisingly, despite reluctance to switch, almost two thirds (59%) of savers are unhappy with the current rate on their account. The research shows that a massive 89% believe that having a good rate of interest is important, compared to four years ago, when less than three quarters (71%)** thought so.
Andrew Goodsell, Executive Chairman, Saga Group, commented: “Having a competitive rate of interest on your savings is a simple yet important aspect of anyone's financial arrangements but few people act on this. If you're not going to regularly check your savings rate then fixing a great rate now is a practical way of making sure you know what your savings are earning. “
*Research carried out online by Opinium on 2,007 British adults from 18th to 21st August 2009
** Research carried out by telephone by BMRB on 2,035 British adults from 10th to 12th June 2005
For more information, please contact the Saga Press Office on 01303 771529