Savers see income slashed as base rates continue to fall
Savers in the UK seem to be next in line to suffer their own form of credit crunch with strong indications that the UK base rates are heading towards 0%. While base rates are currently 2% many savings accounts are earning minimal income even now with many set to fall even further over the next few months. While even a short period where base rates touch near 0% would be drastic and difficult for many savers to cope with, the indications are that any move towards this level could last for sometime and have a serious impact on saver's income levels in the medium term.
The Conservative party has today put forward a new plan of attack which will see savers receive tax credits as an incentive for them to continue saving and as a way to bump up their income in these troubled times. Quite how much it will cost and when it may come into action remains to be seen but this is the first such plan we have seen by any of the leading political parties.
Many savers are of an older age and we could see a significant increase in benefit claimants from this group of society as income levels continue to fall.
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