Millions of savers are picking up stingy returns for savings in their bank accounts when they could easily switch and earn up to an extra £322 a year, according to consumer group Which?
Almost two thirds (62%) of personal savings accounts opened six years or more ago pay a measly £1 on every £1,000 saved, while many more pay interest of 0.5% or less.
Personal finance experts at Which? Money discovered more than a third of savers (35%) had money in instant-access and notice savings accounts and cash ISA accounts paying poor returns that were opened at least six years ago.
Many (38%) claimed they did not bother switching to another account because they believed all savings accounts paid returns at a similar rate.
Which? Money found that these savers could earn an extra £322 a year if they put their money in to ‘best rate’ scheme that pays up to 2.9% interest on an instant access on a bank savings account.
The survey follows a recent report from Which? that claimed savers were missing out on £12 billion a year interest by keeping savers in the dark about best interest rates.
Many savers earn just £1 for every £1,000 in the bank
“All too often, banks and building societies lure in savers with attractive rates of interest, then reward their loyalty by quietly slashing rates to a paltry level later on. It’s a scandal that banks seem to reserve the most pitiful returns for their most loyal customers,” said Which? chief executive Peter Vicary-Smith.
“Anyone who needs a money makeover for 2011 can make a quick and easy start by using our savings booster to find an account that could pay them hundreds of pounds more each year.”
Banks should give savers an annual notice explaining best rates and comparing returns on their existing savings with those they could receive if they switched to another account, suggests Which?
Meanwhile, one in three households say they can’t afford to save and have no spare money at the end of the month, according to a separate survey by the Skipton Building Society.
One in four people have no savings and more than half of people asked (55%) said they can only afford to save £100 a month or less.
