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Building society explains easy way to boost income by £1,000 a year with one simple move

Millions of Britons could be missing out on over £1,000 extra income a year because their savings are in low or no-interest-paying current accounts, new research suggests.

An analysis from Yorkshire Building Society and CACI found collectively, a staggering £366billion is languishing in accounts earning one percent interest or less.

This comes as nearly 13 million current accounts in the UK have balances above £5,001. Among those with at least £5,001 in their current account, the average balance is £23,700.

New consumer research also released by the mutual highlights over a third (36 percent) of UK adults admit they keep their savings in their current account.

Chris Irwin, director of savings at Yorkshire Building Society, said: “Despite the attention savings interest rates continue to have following the significant increases in the Bank Rate, it’s surprising that there continues to be such large pockets of people who are significantly missing out on savings interest.

“We started the year highlighting that keeping large amounts of funds in low-paying current accounts has become a costly mistake for millions.”

The new research also showed despite almost three quarters (72 percent) of Britons confirming they had checked the interest rate on their savings account in the last six months, a fifth (17 percent) admitted they have never checked what rate their savings are earning and over a half (55 percent) haven’t moved their savings in the last year.

This means millions of people are potentially losing out on hundreds of pounds in interest.

Mr Irwin continued: “It’s encouraging to see that for a small number of people they have made moves to improve the situation however there is still an incredible amount of money not earning returns like they could be.

“It’s understandable to want to have money accessible for emergencies or even topping up everyday expenses, but with so many instant access savings accounts currently still available in the market paying much higher returns, access requirements shouldn’t be a barrier to attaining higher rates.”

He added: “As our research has also shown keeping on top of savings rates and moving money around isn’t something everyone keeps up with.

“We really urge savers to review the home of your savings and take positive steps to make it work harder for you.”

Rachel Springall, a finance expert at Moneyfactscompare.co.uk added: “Consumers will have different reasons for why they save and how, but it is essential they check that their account is paying a decent return of interest on their hard-earned cash.”

Ms Springall noted that loyalty “does not always pay” and the convenience of stashing cash in a current account means many savers are getting little to no interest.

She continued: “Interest rates have changed considerably over the past 12 months but if someone does not proactively switch, they could be losing money in real terms due to inflation.

“It’s quick and easy to switch accounts to chase a better return of interest, but some may feel it’s not worth doing if their priorities are focused on using their savings to cover the cost of living.”


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