Where is the interest in savings?

56% of Britons are still visiting the high street to manage their savings despite the fact direct online brands offer consistently high rates in the best buy tables and what’s more, a third of Britons (33%) keep their life savings in a basic current account according to new research from HiSAVE, the online savings brand from ICICI Bank.

The research revealed one in six Britons (17%) are aware that they are earning 0% interest on their main savings account and 53% don’t even know what rate they get for their main financial savings account.

At a time when the Bank of England base rate has fallen yet again, the findings have shown that not only are savers in the dark on where to put their money, they are also openly leaving their life savings to make zero income.

Rock bottom rates

Of those who said they knew the rate they were getting in their savings account, one in six -17%, confessed it was at 0.1% and one in two (48%) are getting an interest rate of 2% or less.

Where are people actually keeping their savings?

People said they were actually keeping their savings in the following places:

Bank current account/ deposit account 33%

An instant access savings account with my local high street 23%

A standard instant access internet/savings account 15%

A fixed term bond 5%

In premium bonds 4%

In a safe at home 2%

Other 18%

Age Differences: Those in the know

It is the older generation, 55 years and older, who are most likely to know the rate they get for their money – 56% compared to 46% of those aged 45-54. Those aged 18-24 are the most guilty of storing their finances in a current account – unlikely to be making any money – 41% compared to 27% of those over 55.

The HiSAVE team commissioned nationwide research to find out where Britons currently have most of their savings and what rate they are actually getting for their money. This is part of a wider piece of research which looks into the saving, spending, investment and borrowing habits of the population to give a rounded picture on the current state of family finances.

Deepak S.Varghese, Head of Retail Banking and HiSAVE at ICICI Bank UK Plc commented: “It is good to see that so many Britons seem to have money aside for a rainy day and certainly in this current climate, we should all have something to fall back on during financial uncertainties.

However, it is of some concern to see that many are not keeping their savings in a place where they can make their money go further, but are instead putting their money into low interest accounts. Despite the recent base rate cuts, HiSAVE 2 year fixed rate account continues to pay 4.10% AER (4.18% gross).

People can easily take advantage of our HiSAVE fixed rate accounts, operated on the same efficient technology platform which serves 25 million customers worldwide, giving UK savers simple savings accounts that offer consistently high returns. Being FSA regulated and FSCS protected, we continue to offer safety and security.”