Almost nine in ten (87 per cent) Brits are not happy with the interest rate that they are getting from their savings accounts.
But despite this, almost half (48 per cent) of the UK’s population still leave their money in low-paying savings accounts as they don’t know where else they can invest.
According to new research from forex platform Learn to Trade, 81 per cent of the UK public does not expect to see their savings to grow much, while 57 per cent said that they would put money into alternative investments if they knew that they would get a better return.
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Younger investors are much more likely to explore these other investment methods, with two thirds of those aged between 18 and 24 saying that they would chose to invest rather than save, compared with just 54 per cent of over-25s.
Furthermore, three quarters of Brits have admitted that they do not know what banks do with their savings.
Just 24 per cent of those surveyed by Learn to Trade said that they had heard of the “Fractional Reserve System” – a law which requires banks to keep only a fraction of their total deposits in cash, and allows them to use the rest to invest in other markets.
“The research clearly shows the public don’t see savings accounts in the same light as other investment strategies, rather as a place to simply put their money,” said Greg Secker, chief executive of Learn to Trade.
“For banks, savings are deposited assets to be traded between one another. In return they give Brits back absolutely miniscule interest – per year – for the capital we’ve unknowingly invested into them.
“It’s clear that the UK public is fed up with these small returns. The banks face the same risks as you and I in trading – they are just armed with effective risk mitigation plans and proven, tried-and-tested trading and investment strategies.”
Eight in ten respondents said that they believe banks should be more transparent about how they are trading their money.
The research also found that men were more likely than women to look into different investment methods beyond savings accounts.
Sixty per cent of the women surveyed said that they did not have a good understanding of the alternative investments available to them, compared with 40 per cent of men.