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Wesleyan urges savers to act after six years of record low interest rates

Six years of historically low interest rates could mean savers have missed out on hundreds of pounds in interest, according to calculations by Wesleyan, the specialist financial services provider for professionals.

The Bank of England kept interest rates at 0.5% today (Thursday, 5 February). This means there will be six full years of record low rates after the Monetary Policy Committee originally cut the bank rate to its record low on 5 March 2009.

With interest rates so low for so long, Wesleyan has calculated a saver with £10,000 could have lost more than £1,250 (£1,293.16) in gross interest over this six year period by failing to shop around for better interest rates.

Wesleyan analysed the difference between keeping money in an account paying interest at the base rate of 0.5% a year compared with one paying 2.5%. For those who had built up a savings pot of £25,000 before interest rates fell, the potential loss of gross interest could be more than £3,200 (£3,232.90).

Samantha Porter, Wesleyan's Group Sales and Marketing Director, said: "Six years of low interest rates has been bad news for savers, potentially costing them hundreds, if not thousands, of pounds in interest.

"There are still uncertainties in the economy and there is no clear indication when we can expect to see a rate rise, so it is more important than ever to shop around to get the best deals rather than leave money in low interest accounts.

"One way for savers to lessen the impact of the low bank rate is to make full use of their ISA allowances, ensuring they do not have to pay tax on any gains they make. A Cash ISA can still provide easy access to money if required, while generally paying better returns than a current or low interest account."

Wesleyan provides specialist financial advice and services to doctors, dentists, lawyers and teachers.

'WESLEYAN’ is a trading name of the Wesleyan Group of companies.

Wesleyan Assurance Society and Wesleyan Bank Ltd are authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Wesleyan Financial Services Ltd, Wesleyan Unit Trust Managers Ltd, Practice Plan Ltd and DPAS Ltd are authorised and regulated by the Financial Conduct Authority.  Advice about investments, insurance and mortgages is provided by Wesleyan Financial Services Ltd.

Click for more information about the Wesleyan group of companies.

© 2018 Wesleyan Assurance Society