Savings carnage

baby_boomer

Over the last 24 hours the best 3 or 4 year fixed rate has fallen 0.7%.

The effect on instant access may be delayed but could be equally devastating .

As BofE rates get closer to 0%, the rate cuts on the best accounts may get bigger, as low paying accounts can no longer be cut .

Doomcow

oh noes! we'll have to deal with it and keep saving till the rate comes up.

if you are a natural saver, you will save. either way, if you save money when the rates go up you have money to save, if you spend it, when the rate go up you still have nothing.

either way, the same rules apply as when in "normal conditions" its just your getting a smaller return for your money - at least your getting SOME return on your money and not spendspendspend and have less than you had to begin.

martinman3

NS&I Fixed Interest Savings Certificates at 2.95% tax-free fixed for 2 years and Index Linked Savings Certificates at RPI +1.0% tax-free (should assume just 1.0% for short term) are beginning to look attractive again.

But it won't do much good for mortgage availability if funds are moved from banks/building societies to NS&I. So expect a cut for certs very shortly.