Savers are missing out on interest payments after new data revealed that a third of bank customers keep their money in current accounts.
Most current accounts do not pay any interest, and even those that do pay much less than the high returns found in savings accounts.
The Bank of England’s 14 consecutive rate hikes have made it easier to access savings that offer interest of up to 5pc.
That could increase even more, according to Governor Andrew Bailey. It is expected to increase the base rate to 5.5pc this week.
A new survey by the Building Societies Association (BSA) revealed that three in 10 savers never check their interest rate, while one in 11 have not checked their account for at least a year. .
A third said they never compare their savings rates. Other labels on the marketThe survey of 2,000 people found that one in seven said they had no nest egg.
BSA Chief Executive Robin Feith said: “Despite the massive media and government focus on savings rates following the sharp rise in bank rates, it’s surprising that people’s relationship with their personal finances is so low.
“With savings rates rising in recent months, buying locally can make a big difference in current returns.”
Big banks were burned By not being able to pass on higher rates to savers.
Although the highest Easy Entry rate on the market is 5.05pc, some savings accounts pay as much as 1.16pc, according to Moneyfacts.
The difference between these two values on a £20,000 savings pot is £778 a year.
BSA research shows the average saver is £21,840.
Most of them did not have a set amount to save each month.
A third said they put money aside whenever they could, and a third said they saved what they had left at the end of the month.
More than three-quarters of savers said they could afford to set aside an extra £120 a year, while half said they could manage an extra £600. More than a third could save an extra £1,200 a year.
Iona Bain, financial analyst and founder of Young Money, said the increase in savings rates was a “silver lining” for families battling high mortgage costs.
She said: “Even if you feel like you can’t afford to give up at the moment, BSA research shows that reviewing where you currently hold your savings can make a real difference. Savers could pocket more than £1,000 just by shopping around for the best deal.