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Most savers doubtful of rate increase in 2016

POSTED: 21st December 2015
IN: Newsroom
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Research shows rate increase best way to encourage savers

  •          41% expect base rate to remain the same throughout 2016
  •          Half believe increasing rates would encourage more people to save
  •          45% expect to save the same amount in 2016 as they did in 2015
  •          Under a quarter (23%) say their likely to open or switch a savings account in the New Year

New research shows more than two fifths (41%) of Britons believe the Bank of England’s base rate is likely to remain at 0.5% by the end of 2016. Whereas one-third (33%) are more positive and expect to see the rate increase.

In the event of a 0.5% increase in 2016, only 14 per cent said it would result in them saving more, while just over half (54%) said they’d probably save about the same.

The research conducted by Aldermore asked more than 2,000 people about their thoughts on the savings environment for 2016 and any immediate financial plans they had in the New Year.

More than one-third (36%) of Britons say they’re likely to pay off all outstanding credit or store card debt, while just under a quarter (23%) would open or switch their savings account.

However, most seemed unlikely to change their financial habits with more than two-thirds (68%) saying it was unlikely they’d open or switch their current account and over three fifths (61%) saying it was unlikely they would start paying into a personal pension.

More widely, most, almost half (49%) agree an increase in interest rates would encourage people to save or save more. Three-in-ten (30%) believe greater savings tax benefits would encourage more too.

Simon Healy, Managing Director for Savings, Aldermore, said:

“Even when rates are relatively low, it’s important savers continue to shop around as there are plenty of providers giving competitive rates and allowing you to get better returns on your investments. Interest rates may have increased in the US, but there’s no indication the Bank of England will follow suit any time soon .

“The New Year should be an opportunity to maximise your ISA allowance before the end of the tax year and where possible, to take advantage of new savings products such as the Help to Buy: ISA.

“I will be interested to see the effect of the new Personal Savings Allowance which will allow savers to keep more of the interest earned on their savings and put more away to those all-important rainy days.” 

**Ends**

For further enquiries, journalists can contact:

Adam Taylor, Cicero Group
Phone:          0207 297 5971
Email:           adam.taylor@cicero-group.com 

Rachael Snelling, Aldermore
Phone:          0208 1853 102
Email:           Rachael.Snelling@aldermore.co.uk 

Notes to Editors:

Findings are based on research that was carried out with Opinium Research. The survey consisted of 2,003 nationally representative UK adults aged 18+ between 4th to 8th December 2015. Opinium Research is a member of the British Polling Council and abides by its rules.

For further information about Aldermore, our financial backers and our PR contacts, please review our Notes to Editors page.

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