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By Sarah Wray Staff Writer
Thursday, 1 May 2008
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WHILE high street accounts are currently offering some of the best savings rates ever, a new survey shows that only 57% of people think that a bank or building society is a safe place for their money.
Even more surprisingly, the survey conducted by Newcastle Building Society revealed that three times as many Britons as last year now feel the gap between the mattress and the bedframe is the best place to stash their cash.
Savings rates rising
Ironically, savings interest rates have been steadily rising over recent months as banks and building societies battle it out for customers’ money, following the Northern Rock crisis and the wider credit crunch, which has closed off international money markets.
Many banks are offering the best savings rates in years.
Some instant savings accounts now pay upwards of 5%, while customers determined to hunt down the best deal can easily earn over 6% on some savings accounts.
The mattress offers a 0% return, and sees your money decreasing in value by 2.7% as inflation eats into its value.
Back on the high street, savings rates offered to new customers are especially favourable.
Distrusting
However, despite the soaring savings rates, consumers are increasingly distrusting of the banks and building societies, with the Northern Rock crisis and the broader credit crunch fuelling their misgivings.
The Newcastle Building Society survey revealed that a growing number of people now feel that the safest place for their savings is under the mattress rather than in a bank or building society account.
1 in 10 choose the mattress
11% of people questioned in the survey said that they felt their home was the safest place to keep their money.
This figure was up 4% on last year’s.
Further, Only 57% believed the safest place for their money was in a bank or building society, compared to 74% a year earlier.
Whether their misgivings stop them from actually putting their money into a savings account is not altogether clear.
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