Savers who have already seen their returns plummet now face more devastation following the Bank of England's interest rate cut, experts have warned.
It is thought that those who are on the brink of retirement may face particular challenges from the Bank slashing interest rates from 0.75% to 0.25% in an emergency move.
Anna Bowes, co-founder of Savings Champion, said: "Today's announcement that interest rates have been cut is devastating news for savers who have lived with record low savings rates for over a decade. Savers have seen cuts to both the best buy and existing savings accounts accelerate over the last couple of months in particular, even though no base rate cut has happened until today."
And it's not just the rate cut that can impact the rates on offer to people looking for somewhere to store their cash - with other schemes designed to get money to small businesses in need also announced by the Bank of England.
"From past experience, we know just how damaging an emergency lending scheme can be to savings rates, let alone a cut in the base rate," Bowes said.
But people willing to act quickly might be able to mitigate the impact of some of these cuts.
MoneySavingExpert.com founder Martin Lewis explained: "As fixed-rate savings tend to be offered in tranches – ie, a firm will have planned to bring in £10million, until they fill that amount the rates won't drop – so quick movers may be able to bag top 1 or 2 year fixed-rate savings today before the rates fall."
For others, research is key.
Sarah Coles, personal finance analyst at Hargreaves Lansdown, said: "You don’t have to settle for the increasingly miserable rates on offer from the high street giants, because you can get significantly better rates by shopping around with newer banks, Sharia banks and building societies – whose rules mean they’ll still try to balance the needs of their borrowers and their savers."
