People in retirement are potentially facing steeper losses than the rest of the adult population.
Pension experts are urging older people to check the interest rate they currently have on their savings accounts after new research indicated at least half of retirees could be missing out on hundreds of pounds each year. Pension Bee warns those missing out most are people with an interest rate of three per cent or less.
A retiree with a savings balance of £50,000 in an account paying two per cent interest would receive £1,000 in interest after one year. If their cash was held in an account with a five per cent rate, they would receive £2,500 in interest after a year - a difference of £1,500. Top Money Stories Today Over-65s appear to prefer the convenience of instant-access accounts, which tend to pay less interest than notice accounts. Over half of this group opted for instant-access compared to 37 per cent of working age savers, suggesting pensioners may use their savings accounts for income in retirement, rather than or as well as flexi-access drawdown - more pensioners noted having an instant-access account than having a workplace or private pension .
Latest State Pension News Best savings rates on offer this week MoneySavingExpert.com has a handy guide to the best savings rates on offer which is updated daily - find out more here. Top offers this week so far are listed below, full details on MSE.com.Commenting on the research findings, Becky O’Connor, Director of Public Affairs at PensionBee, said: “The older generation has the most to lose from keeping money in an account that does not pay a competitive rate of interest.
FSCS cover for savings balances goes up to a limit of £85,000 per person, per institution. It’s important to remember this when choosing how much of your savings to keep where.
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