Easy-er to beat inflation - savers benefit from a further drop
Today's announcement by the Bank of England that The Consumer Price Index (CPI) has fallen to 2.4 per cent from 2.8 per cent brings great news for savers. Eleven easy access saving accounts now beat inflation- the first time this savings vehicle has beaten the effects of inflation since November 2009. Consumers should check their savings rates to ensure they are maximising their returns according to MoneySupermarket.com.
To beat inflation, basic rate tax payers will need an account paying at least 3.00 per cent to gain benefit in real terms from their savings, increasing to 4.00 per cent for higher rate tax payers, and 4.80 per cent for 50 per cent tax payers.
For basic rate tax payers there are now eleven easy access accounts, eight cash ISAs, 192 fixed rate bonds and 76 fixed rate ISAs that beat the eroding effect of inflation. For higher rate tax payers still no easy access accounts beat inflation and only eleven fixed rate bonds and seven fixed rate ISAs beat inflation.
Kevin Mountford, head of banking, at MoneySupermarket.com, said: "Today's news that inflation has fallen even closer to the Bank of England's target of 2.00 per cent is welcome news for savers who can easily find inflation beating products and it's great that after three years, eleven easy access accounts can once again help savers to do so. It is therefore vitally important savers check their rates and be prepared to switch if they are not on the most competitive deal. The difference between the average and top paying rates can be significant so moving to a better deal can go a long way to help savers limit the impact on their pots."