Investors opt for safety

by Gill Montia

Story link: Investors opt for safety

Sainsbury’s Bank has published research giving evidence of a shift amongst savers who are making more use of high interest savings accounts.

According to the bank, investors are prioritising safety over returns because of the recent turmoil on the stock markets.

For the purposes of the survey the bank defined “high interest” as a rate above 6% and the research revealed that between August 6th and August 19th 2007, such savings accounts recorded a 42% increase in activity.

Sainsbury’s Bank believes that the increase can be directly attributed to the recent volatility of the stock markets.

Also published is the results of a survey by the Post Office, which claims that one in four UK adults are failing to save any money at all.

Just over a quarter of respondents in this category said they were unable to save because they had too many debts to pay off.

The research also indicates that one-third of the people who do save, do not do so on a monthly basis.

The most common reason given for saving was to fund a holiday, however nearly half of those aged 55 to 64 reported that were saving for retirement.

The latest figures from the Office for National Statistics, released in June, showed that proportionately, Britons were saving less of their income than at any time in the last 50 years.