Eight in ten savers in the dark over interest rates

Eight in ten savers have no idea how much interest their accounts are paying... and would probably be shocked to learn that the average rate is just below 1%.

Annual inflation is currently running at 4.2%, which means that your savings are being eroded rapidly.

Apathy is most widespread among younger savers: 89% of under 25s don't know how much interest their account is paying. But 84% of 35 to 44-year-olds are also in the dark, according to a survey by HSBC. The research also found 60% of adults don't know how much money they have stashed away in their savings pots.

To be honest, it is not that easy to find out what the savings rate actually is. Most banks don't publish their rates on statements and online; you have to ring them up or wade through a long list of interest rates for various accounts to find the one that applies to you.

You should make an effort to find out how much interest you're getting, though, because best buy rates often only last for 12 months and thereafter drop off to close to zero. That could mean you'll be getting just 0.1% a year - or £1 for every £1,000 held in a nest egg.

Many children's accounts offer pitiful rates at present, according to separate research from Which? - just 1.01%, on average, with some paying as little as 0.05% - 50p for every £1,000.

Nationwide is considering whether to display savings rates on online account pages. We can only hope that other banks and building societies will follow suit.

In the long run, shares always outperform cash investments so you might want to consider investing in the stock market (although you should also have an instant access savings account for emergencies).
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