Savers 'need to maximise returns'

By Sarah Engle, Fri 11 Feb 2011 - Published in Banking

Savers need to look for the best places to put their money in the current low-interest environment, an expert has suggested.

Alan Easter, director of Willis Owen, pointed to the recent decision by the Bank of England's Monetary Policy Committee to hold the UK base rate at 0.5 per cent and said it is "no surprise".

However, he claimed that the news will be significant to those with large sums of money in the bank as they are seeing the real value of their savings eroded by inflation.

"The message this sends to savers is simple: with high street savings accounts continuing to provide below inflation returns, alternatives should be considered now to help people generate the income they are looking for," the commentator added.

Mr Easter recommended that people consider placing their money in investment funds such as stocks and shares ISAs to achieve returns on their savings.

This week, Nationwide director of savings and investments Robin Bailey said people who are looking for higher returns over a longer period of time should think about opening a stocks and shares ISA, even though these products have a greater exposure to risk than cash ISAs.

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