People in the UK might not be getting the best from their savings accounts because they do not fully understand the impact of inflation and tax, a new survey shows.
Research by National Savings and Investment (NS&I), reveals that 40 per cent of people do not know how inflation affects their money .
A further 28 per cent do not know what impact taxation has on their savings accounts .
John Prout, NS&I's sales director, said: "It appears that an understanding of the impact of inflation and tax on savings increases as we get older."
Because of this, younger people should make a special effort to understand the ways in which their savings might be eroded and how this can be avoided, he added.
Recently, David Black, principal consultant of banking for Defaqto, claimed that lower-rate taxpayers need a gross return of 5.45 per cent on a savings account to prevent their money being eaten up by inflation.
Inflation hitting savings accounts, expert warns
Inflation hitting savings accounts, expert warns
Thu, 24 Jul 2008
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