Anyone with £10,000 savings given £300 warning to act today over change | Personal Finance | Finance

Financial experts said people need to take action today with the Bank of England is expected to cut interest rates to four per cent tomorrow (Thursday), and said it could make a difference of £300 for anyone with savings.

A finance expert has warned savers who don’t act quickly that they could be locked out of the competitive rates currently offered by savings accounts for months or even years. The Bank of England could even reduce interest rates to 3.5 per cent by the end of 2025 according to some analysts.

According to one expert a person failing to move £10,000 today could lose out by £300 a year. Antonia Medlicott, Managing Director of financial education specialists Investing Insiders said: ‘’Savers risk missing out on hundreds a year in interest if they delay. We’re at a tipping point where savings accounts still offer rates above 5.5 per cent, but those deals are likely to vanish fast.”

“In fact, recent analysis by Moneyfacts has revealed that switching £10,000 into an account with a top interest rate now, could earn the saver more than £300 extra a year compared to the average rate within an ISA, which currently stands at just 2.7 per cent.

“Savers currently earning under 4.5 per cent are urged to switch now to prevent leaving money on the table, with economists currently predicting further cuts in November, possibly reaching as low as 3.5 per cent by the end of this year.”

Whilst all savers should hunt around for the best deals, Antonia warns that delaying this could result in missing out, and revealed the best accounts to use right now. Antonia said: “Banks are quick to adjust interest rates on savings accounts downwards, usually much faster than they increase. Most people are unaware of how quickly savings rates change.”

She added: “The public should act quickly. The top interest rate outside of a Cash ISA is currently six per cent at Santander; however, this is a bonus rate with restrictions that savers should make themselves aware of.’’

“Within a Cash ISA, the top rate is currently 5.44 per cent with CMC Invest, which is still excellent, and the advantage with this account is that any gains are sheltered from tax. ISA uptake and switching rates are lowest in parts of the North West, Wales, and East Midlands, leaving Brits in these areas particularly vulnerable to falling rates this week.”

Finally, Antonia explains the importance of using an ISA allowance to help people pay less on their savings. She added: “Remember to utilise ISA allowances as cuts to Capital Gains Tax allowance will mean more and more people are pulled into paying tax. This is especially true for higher-rate taxpayers who are urged to prioritise ISAs over standard savings accounts due to the reduced rate on the personal allowance.”

Ahead of the Monetary Policy Committee’s base rate decision tomorrow, Investec Save, also said it anticipates a cut to the Bank of England base rate which it expects will lead savers to choose fixed rate products for their deposits as they seek to lock in the most attractive and advantageous returns. Rate cuts are also expected to continue in the second half of this year and into 2026.

Investec Bank’s economists predict that the Bank of England base rate, which currently stands at 4.25%, will reduce to 3.75% by the end of 2025. Investec expects rates to reduce further in 2026 settling at just 3% by the summer of 2026.

Investec Save’s research shows that nearly two out of five savers (37%) plan to switch their funds into fixed rate savings accounts this year in response to potential Bank of England base rate cuts. Those planning to put their cash into fixed rate accounts will on average switch £15,800 into fixed rate savings.

Phil Shaw, Chief Economist, Investec, said: “We predict a higher number of savers to move their money into fixed rate products as they look to secure attractive returns before anticipated further cuts to the Bank of England base rate.

“The base rate has already been cut four times since last summer, and we anticipate that it will fall further still in the second half of 2025 and into 2026. Savers are looking to act now to secure a higher rate and the peace of mind that their money is working hard for them.”