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Savings News - Last Updated Friday 5th December 2008 Syndicate this
Where can the savers go?

Friday 5th December 2008

As the rate on some savings accounts in the UK moves seriously close to 0% there are grave concerns that savers, who until now have been fairly insulated from the economic downturn, are set to see their incomes reduced drastically over the coming weeks and months. The fact that some savings accounts have had their interest rates removed has forced savers to look elsewhere where rates are still very low to say the least.

This continuous erosion of income from savings accounts will push more and more people into the income trap and put more and more pressure on the government to bail them out. In a rather perverse ways it seems as though savers, those who have scrimped and saved for the future, are being hit and expected to bail out those who may have been a little rash with their own finances over the last few years.

Many people are now starting to ask where the incentive to save is coming from, although on the other hand maybe this is what the government is looking for as more and more people look to invest in the stock market and government bonds. The situation for savers is unlikely to get better in the short term as interest rates look set to fall further with some experts suggesting a 0% base rate target in due course.

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