National Savings and Investments (NS&I) have yet again announced that they will be cutting interest rates on savings from June 2016 and also reducing the number of prizes available in Premium Bonds.
Some 23.5 million customers will be affected.
In November we posted a blog as NS&I cut their rates from 1.5% to 1.25% for savers. Now a further cut has been announced on their ISA bringing returns down to 1% (a new 7 year low).
Once again, the cut is following a trend in the market as banks and building societies are doing the same which means that although returns are lower, NS&I still remains competitive.
June 2016 also marks a reduction in the chances of winning a premium bond prize to 30,000 to one – a 15% reduction.
Looking ahead, savers need to look at alternatives to make sure that their money is safeguarded from the effects of inflation.
If you would like to speak about alternative strategies for safer returns please do not hesitate to get in touch with Platinum.