So far in 2013, many savers will have kept a close eye on the gradual fall in the rate of inflation and considered what it might mean for their precious funds.
November saw rates reach 2.1%, down from 2.7% in January and ever so slightly nearer to the government’s target of 2%.
However, it has still been a bad time for savers as poor rates across savings accounts and ISAs mean very few people have managed to build up their nest eggs sufficiently.
Are savers winning the battle?
Beating inflation is key to this but research suggests there are very few accounts available where that is actually possible.
It is therefore a very depressing situation for a lot of savers who are watching as tax and inflation slowly chips away at their savings.
For instance, a basic rate taxpayer in the UK paying 20% would need a savings account paying at least 2.63% to make a saving.
That figure rises yet further for those in the higher tax bracket of 40%, with a rate of at least 3.5% required.
About one in 25 non-ISA accounts actually offer this sort of rate, while one in ten ISA accounts would see people make a saving.
With such a low amount of products on the market it is easy to see why people have turned away from the idea of saving in general.
But those figures are a marked improvement on August of this year when only one account was capable of beating inflation.
Are things looking better for UK savers?
That would suggest that the situation is looking up and that maybe it is time to consider savings accounts once again.
With the economy in the early stages of a recovery, rates have started to edge higher and this has coincided with the gradual drop in inflation.
In truth, savers have been bombarded from all sides throughout the recession as introductory bonuses are shrinking and rates are poor.
When put in perspective, the effects of inflation would mean that £10,000 invested five years ago would relate to just over £8,800 today.
Saving is clearly very difficult but finding an account that beats inflation would represent a saving, and is certainly better than having to hide savings in a pillowcase or under the bed.
With the outlook for 2014 looking positive, it might be worth investing into a short-term saver and seeing what benefits come from it.
That said, with Christmas just around the corner, saving could be unlikely and that is where a prepaid card can come in handy – both as a gift or a tool to save up money for next Christmas!
