Savers are currently enjoying some of the best returns on their money in nearly 20 years, it has been argued.
Interest rates may be low at the moment, but so is inflation, which means, in real terms, that savers are seeing the value of their money rise dramatically.
Taking tax and inflation into account, higher rate taxpayers are generating an average of 2.01 per cent on their savings, the highest rate of return since 1991.
Banks and building societies, keen to draw in new customers, are beginning to offer above-base rate interest on a number of accounts. That, coupled with the effect on prices of the fall in CPI inflation, has pushed up the real worth of money held as savings.
Michelle Slade of Moneyfacts, the financial comparison website, said: “Savers might feel under the cosh, but don’t be fooled into thinking now isn’t a good time to save.
“With falling prices boosting the value of cash, and banks and building societies prepared to pay above Bank rate to attract deposits, there’s rarely been a better time to save in the past two decades.”