Darling mustn’t ignore the plight of elderly savers

Even though CPI has fallen from 3.2% in February to 2.9% in March, savers will still find it a challenge to find an account where they can preserve the spending power of their nest egg.

2.9% equates to a gross rate of 3.625% for a basic rate tax payer and 4.83% for a high rate taxpayer.

With the majority of variable savings rates paying less than 1%, the Chancellor needs to step up to the mark and deliver a budget that will help those who are relying on savings income to make ends meet.

The combination of ultra low interest rates and CPI at the current level continues to make life hard for those who depend on savings income just to get by. Unfortunately many will have started to make deep inroads into their capital and may not have sufficient left to do this for much longer.

As CPI starts to fall further we will see the trend starting to reverse and a scenario where more savers will once again benefit from a real return on their savings, however many elderly people on low fixed incomes need help now not in six months time.