Martin Lewis has said that thousands are being duped and ripped off when it comes to savings rates and that it was time to “stop the savings rip-off.”
The MoneySavingExpert founder said that many people are getting much less interest than they deserve and that they should consider switching. Savings rates are at their highest since 2009, with fixed-rate accounts now offering an interest as high as 4.85 per cent, he said in a special live episode of the Martin Lewis Money Show on ITV.
Mr Lewis said many savings accounts were paying rates that are “less than dismal”. But, he added, the rates on the best savings deals are going up rapidly. “So the huge majority of you can earn far more if you ditch and switch.”
One caller on the show, identified just by her first name Deborah, told Mr Lewis that “I recently sold a house and with that, I managed to pay off the mortgage of the house that I’m in just now.” She continued: “I’ve got a few grand left in the bank but I haven’t a clue what to do with it - whether it should be an ISA or a pension.”
Mr Lewis responded by saying that savings rates are going up rapidly, but not everyone is benefitting. He said that the top easy access accounts are paying 2.5 per cent so the “huge majority” of people could earn far more if they “ditch and switch”.
He continued: “What’s also interesting about this is the difference between fixed rate savings and easy access savings. Recently, the difference has exploded. Two-year fixes are paying a disproportionately higher amount than easy access at the moment.”
In another part of the show, he also shared the little-known fact that Britons could be entitled to a Severe Mental Impairment (SMI) discount which could save them from paying council tax on their property.
Individuals must meet certain criteria before they are legally eligible to be discounted for council tax purposes.
Mr Lewis said: “Now what that means is, let’s imagine it was me, and me and Angelica were a couple living together. I’ve got SMI, so Angelica is the only adult in the household who is eligible to pay council tax, so you are going to get the 25 per cent single-person discount.”
Mr Lewis said: “It is so undercover that some offices when you call them up don’t even know it exists.
“If you think you know anyone in that position, look up the Severe Mental Impairment council tax discount and there are probably 100,000 people out there missing out.”
Mr Lewis also urged people in the UK to check their state pension entitlement and their national insurance record, suggesting some could be missing out on thousands of pounds in their pensions.