Nearly two out of five savers (37%) plan to switch more cash into fixed-rate savings accounts this year in a bid to beat the Bank of England’s base rate cuts, according to research from Investec Save.
In May, the Bank of England cut the base rate from 4.5% to 4.25% and maintained this in June, with further cuts expected this year.
Investec Save said on average, savers plan to switch £15,800 into fixed rate savings.
Around one in seven (15%) said they would put between £10,000 and £19,999 into fixed rate accounts this year, while another 15% plan to save between £1,000 and £2,999 in fixed rate accounts.
A further 13% of savers expect to put away between £5,000 and £9,999, with 12% squirrelling away between £3,000 and £4,999.
On average, savers have around a fifth of their savings in fixed rate accounts currently.
David Hunt, head of savings at Investec Bank, said: “Our research shows that savers plan to vote with their feet, with 37% planning to take out fixed-term savings products. Interestingly, many say they will put considerable sums of money into these, which could reflect a growing degree of caution among savers.
“With the Bank of England expected to make further cuts to its base rate over the next year, fixed rate accounts can serve as a valuable hedge to help protect savers’ returns.”
Main image: martin-martz-jdG3ykvLZGY-unsplash
