Although miniscule, a small rise in the consumer price index figures from August to September could cause worry for UK economists and the overall wider UK economy.
The latest inflation report from moneyfacts.co.uk has shown that basic rate taxpayers within the UK need to find a savings account within the UK paying 5.63% per annum to beat inflation, as higher rate taxpayers will need to obtain a savings account of 7.5% to be better off in real terms.
Inflation rose from 4.4-4.5% from August 2011, as individuals from the UK continue to struggle during difficult economic times. Today’s news could potentially be damaging for the mortgage broker, with a worse standard of living for many UK citizens seeing them unlikely to seek to purchase property within the UK, unless for trading down purposes.
With not a single account available for UK individuals which beats retail price index figures of 5.2% within the UK, a significant proportion of the country is worse off in real terms than it has been previously.
Spokesperson for MoneyFacts – Sylvia Waycot – has today claimed: “Inflation continues to whittle away any hope of a decent return on the nation’s savings. Without any hope of respite, all savers can do is sing the blues as they watch their spending power disappear down the Swanny.
“Today’s rate of inflation means hundreds of thousands of savers need accounts paying a staggering 7.50 per cent before they earn a real rate of return on their savings. Anything less means they will fall into ‘the eroding spending power trap’ which has already wiped £655 off the spending power of £10,000 in just five years.’
Although inflation levels remain in high within the UK, the number of competitive mortgage products available to individuals is at its highest levels since the start of the economic downturn. With a number of cost effective packages now on offer, a mortgage broker could help obtain a mortgage for a purchase, or for a remortgage in order for individuals to stay within budget.