I had a letter from my bank the other day.
It was telling me that as from June 1st, the interest rate on my savings account was being reduced.
It’s already a pittance, as are all savings rates now, unless you can afford to tie your money up for a year or more (which I can’t), and even then, the rates aren’t much better, plus there are penalties.
Gone are the days when you were encouraged to save for a rainy day or your retirement.
Pension pots have been raided via government loopholes, if not lost altogether when companies went to the wall, and should I not have taken my pension at 50 even though I’d been made redundant in 2001, I would have lost my entitlement when the company was sold on. That, and two small annuities from private pensions (as encouraged by the Government to take out if my work place didn’t have one and which total £150 a year) are my only income, plus the interest received on my ‘pension pot’, the lump sum received at 50 which was to last until I was 60, the state retirement age at the time. That now has to last a further 6 years, if not longer should the government move the goal posts again.
Government schemes for ISAs to help towards a deposit on a house are laughable. They are over a period of 5 years, when house prices will be even more out of reach and the deposit saved so hard for won’t be enough to comply with whatever the latest morrgage application legislation is, even with the ‘generous’ Government incentive.
As if pathetic interest rates weren’t enough, unless your savings are in an ISA or you aren’t a tax payer (like us due to low income), you have to pay tax (20%) on your interest as well. Double whammy for the Government and another kick in the teeth for the saver.
Whilst I’m not surprised that interest rates for savers are still going down, what annoys me most is the amount it’s going down by. I am about to lose a third as my rate reduces from 1.5% to 1%.
Our savings have reduced as well as interest rates, so what is the point of having them? £10 per thousand saved per full year isn’t going to do much, even by our frugal way of living, especially as my food bill is forever increasing, no matter how careful we are when we shop.
Think on this though.
It has been known for years that there is not enough physical money in circulation to cover customer deposits. These days, everything is done by electronic means, just a transferance of 0s between accounts, banks or countries. To me, it isn’t real, and because of that, I feel The Powers That Be have lost track with reality.