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How to beat the ‘onslaught’ of savings rate cuts

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It’s a disappointing end to a tough year for savers as providers continue to pull their best deals.

In the past month, the number of products that beat the Bank of England base rate of 0.75% has fallen by 80, the biggest drop in two years.

There are now 1,254 deals that offer interest above the base rate, the lowest total since March 2018, according to Moneyfacts.

Rachel Springall, finance expert at the data firm, said: “It has clearly been an unforgiving year for the savings market, which has felt an onslaught of cuts – and seen deals pulled from the market entirely – as providers reined in competition.”

Rates have fallen across both fixed term and easy access accounts, with prominent brands like Virgin Money slashing deals.

For this reason, savers are urged to remain vigilant.

“Savers will need to keep a very close eye on these changes in the market as a lack of vigilance could mean that they are earning a less attractive deal than they realise,” said Springall.

Top tips for struggling savers

Sign up to savings rate alerts and be sure to keep on top of any emails from your existing provider. Savings providers can change variable rates at any point, so consumers need to keep tabs on changes and move their money if they find they are on a poor rate.

Compare rates regularly, especially if your cash is with a big high street bank. As an example, Marcus by Goldman Sachs pays 1.44% right now on its Online Savings Account, while HSBC pays just 0.10% on its Flexible Saver.

Consider a high interest current account. Nationwide currently pays 5% AER on its FlexDirect up to balances of £2,500 for the first 12 months. Savers must credit the account by £1,000 to be eligible.

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