Interactive Investor

NS&I ups savings rates again

13th July 2023 10:23

Myron Jobson from interactive investor

Move could keep competition alive in the rest of the market.

Commenting, Myron Jobson, Senior Personal Finance Analyst, interactive investor, says: “The NS&I is on a roll when it comes to upping savings rates – a move that could keep competition alive in the rest of the market.

“The interest rates paid on the NS&I’s Guaranteed Growth Bonds and Guaranteed Income Bonds are much better than the equivalent savings products offered by high street banks, but savers can still get better deals by shopping around.

“The stark reality is while there has been a reprieve in savings rates, they continue to run a losing race against the stubbornly high cost of living. When inflation gallops ahead of savings rates, it means that the prices of goods and services are increasing faster than the interest you earn on your savings. This mismatch between the growth of your savings and the soaring prices means that, in real terms, you’re losing ground. The things you could have comfortably purchased with your savings before, now require more money. It is a race that savers can’t seem to win at present.

“Those who can afford to put money away for five years or more should consider investing for the potential of long-term inflation-beating returns that far outstrip savings rates.”

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