Savvy Brits are saving billions as interest rates skyrocket

Britons have got the savings habit back Britons have got the savings habit back after pumping £3billion more into their deposit accounts than they took out in June as they race to grab today’s best buy rates of around 6 percent. This follows net withdrawals totalling £3.4bn in May as savers raided their funds in a bid to combat the ongoing cost-of-living crisis. Savers may get an added incentive tomorrow if the Bank of England hikes interest rates for the 14th meeting in a row. Markets expect the BoE’s ratesetting committee to lift the bank rate from today’s 5 percent to 5.25 percent. On Monday, City watchdogs launched a crackdown on high street big banks which have been accused of ripping off savers by failing to pass on rate hikes, but experts say savers must take things into their own hands to get a decent return. Fixed-rate bonds offer today’s highest savings rates with Melton Building Society paying 6.1 percent a year over two years and RCI Bank offering 5.8 percent for five years. READ MORE Expert explains what another BoE Base Rate rise could mean for your finances Bank of England may increase interest rates again Savers responded by depositing £6.6bn into fixed-rate accounts in June with one-year fixes also popular, said Laura Suter, head of personal finance at AJ Bell. Yet millions are failing to take advantage with a staggering total of £270bn sitting in accounts paying no interest at all. “There is still a huge amount of work to do to encourage savers to move their money to accounts paying a decent rate,” Suter said. Most easy-access accounts continue to offer disappointing returns with banks paying an average of just 1.46 percent today. By contrast, challenger bank Shawbrook’s best buy rate pays a variable rate of 4.63 percent and Beehive Money pays 4.60 percent. Savers may be tempted to delay taking out a new savings account SUBSCRIBE Invalid email We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info