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Rising inflation hits savers
Inflation soared to 5.2 per cent in September, the highest level for three years, leaving savers with fewer ways to earn a real return on their savings.
Inflation figures released on Tuesday show that the Consumer Prices Index (CPI) -the index used by the government to measure inflation - rose from 4.5 per cent in August to 5.2 per cent in September.
According to the Office for National Statistics, this is the highest level since September 2008 when CPI was also 5.2 per cent.
It said the biggest upward pressure in inflation came from increases in gas and electricity charges. Over the past few months, consumers have seen a rapid rise in domestic gas and electricity bills, with annual bills rising to £1,345 a year for the average household, double the £740 average five years ago.
Figures from Moneyfacts, the independent financial information provider, the latest rise in inflation means there are no regular savings accounts that beat inflation in the current market.
To beat inflation, a basic rate taxpayer at 20 per cent needs to find a savings account paying 6.5 per cent, while a higher rate taxpayer at 40 per cent needs to find an account paying at least 8.67 per cent.
FOR AN INFLATION BEATING INVESTMENT 12 MONTH INSURED LOAN NOTE - LINK
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