Lancashire savers missing out on £1000s in interest

Research from the Building Societies Association (BSA) for UK Savings Week (September 18-24), found that 36% of savers in the North West hold most of their savings in a current account, which typically earns little to no interest.

Of those who do save regularly, 81% are confident they could save £10 more a month, 54% believe they could save £50 more a month, and 34% said they could save £100 more a month.

This means that the region’s savers could be missing out on a significant amount of interest. For example, 1% interest on £5,000 would earn £50 per year in interest. However, if they switched to a savings account with an interest rate of 5%, they would make £250 per year in interest.

To help the region’s savers build a more financially secure future, the UK Savings Week challenge offers the following steps:

1. Set a goal by reviewing your finances and setting an overall target

2. Make saving a habit by setting up monthly payments into a savings account

3. Reward yourself for hitting smaller savings targets (e.g., if your goal is £5,000, reward yourself at £2,500).

In a bid to pass on the benefits of recent interest rate rises, Furness Building Society recently unveiled a 5% interest Triple Access Saver account which has proved to be a very popular option with savers. The society, which has branches in Poulton-le-Fylde, Lancaster and Preston, also saw a 115% increase in website sessions in the week following the savings account being announced.

Lawrence Chan, Head of Savings Strategy, at Furness Building Society, commented: “Whilst it's encouraging to see so many savers take advantage of our new 5% interest savings account, these results from the BSA show that many savers in the North West are still not getting the most out of their money.

“It’s important for everyone to have some savings put aside for a rainy day, even if it’s just a small amount. Having an emergency fund can make all the difference when an unexpected circumstance impacts your finances, such as job loss or emergency home repairs. The UK Savings Week Challenge is a great way to start building that pot, and ultimately make savings a habit.”

Robin Fieth, Chief Executive of the BSA, commented: “Despite lots of media and government attention on savings rates following the significant increases in the Bank Rate, it’s perhaps surprising that the level of engagement people have with their personal finances remains fairly low. As savings rates have been increasing over recent months, shopping around can now make a sizable difference to the returns available.

“It’s encouraging that many of those who currently do not have any savings are confident they can start saving every month, and there are lots of different savings accounts available for all levels of savers.

“Every small contribution made to a savings pot can go a long way, but the key to this is starting a savings habit. We all know life gets in the way, and savings, understandably, can slip down the priority list. But taking the thought out of saving and putting away a set amount at the start of each month – for however much you can comfortably afford – can be a great way to make it a habit and achieve your savings goals.”

*Research conducted by Opinium on behalf of the Building Societies Association via two online surveys:

1. Between 23 – 27 June 2023 with a nationally represented sample of 2,000 UK Adults

2. On 21 June 2023 with a nationally represented sample of 2,000 UK Adults