The start of the New Year has prompted many to resolve to put more aside more money for a rainy day. However, while savers’ intentions are in the right place, Moneyfacts.co.uk’s research shows that few may be encouraged to follow through thanks to less than enticing savings rates.

In fact, the average easy access ISA rate has fallen by 0.19% from two years ago to stand at 1.06% yearly, the lowest level Moneyfacts.co.uk has ever recorded.

Charlotte Nelson, Finance Expert at Moneyfacts.co.uk, said:

“A brand new year does not necessarily mean a fresh start in the savings market. Indeed, savings rates today have hit another record low and make disappointing news for the start of 2016.

“Savers wanting to start building a nest egg will look towards highly flexible easy access savings accounts and ISAs, but anyone looking at the rates available today will perhaps question the benefit of saving at all.

“For example, back in 2013 the top paying easy access ISA paid 2.75% yearly, but the best rate today is only 1.50% - a significant 1.25% less. Standard easy access savings accounts don’t fair any better, either, with the top rate falling by 0.68% from 2013 to just 1.65% today.

“For a long time ISAs have been the go-to product for not only some of the best rates but also for the tax shelter they provide. However, with the new tax rules for all savings accounts coming into play in April, ISAs are likely to lose some of their attraction, meaning low rates are likely to become more, not less, prevalent.

“With such a glum outlook, savers are pinning their hopes on a base rate rise this year, but as money from the Funding for Lending Scheme still needs to be spent, the potential boost to savings rates by a rise in base rate could be weak to non-existent.”

www.moneyfacts.co.uk - The Money Search Engine

Moneyfacts.co.uk is the UK's leading independent provider of personal finance information. For the last 20 years, Moneyfacts' information has been the key driver behind many personal finance decisions, from the Treasury to the high street.

Only logged in users are allowed to post comments. Register/ Log in

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2024 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.