Martin Lewis issues urgent warning to anyone with savings in interest accounts

Martin Lewis has issued a call to action for savers to make the most of their money. Following the Bank of England's announcement earlier this month that the base rate was dropping from 5 to 4.75 percent—the second cut this year—Lewis highlighted the impact on loans, mortgages, and savings accounts during his BBC podcast.

Martin advised: "My big message for anyone with savings right now is that you need to check what interest rates you are paying... The fact that you had a good account a year ago doesn't mean it is anymore."

The financial guru and TV personality recommended that savers with accounts offering less than five percent should scout for better deals, especially since top easy access accounts currently offer around that rate. He also suggested considering fixed-rate savings accounts, adding: "The difference is you get an absolute guarantee of what the rate will be for a set term, but in order to do that you need to lock money away."

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Currently, savers can find fixed-term accounts offering around 4.7 per cent interest. Although this rate might be lower than some instant access options, it has the advantage of being unaffected by potential base rate decreases.

The main consideration with fixed-term accounts is ensuring you won't require access to your funds during the term, such as one year.

Martin Lewis also highlighted the potential benefits of regular savings accounts, which may offer interest rates as high as seven per cent. While highly attractive, these accounts typically cap the amount you can deposit monthly, and the limit is often modest compared to other types of accounts.

"Most of the best deals here are linked to your existing bank accounts," Martin noted.

For individuals receiving Universal Credit, the Help to Save scheme presents an opportunity worth considering. This government-backed program allows users to save between £1 and £50 each month.

After two years of saving, participants receive a bonus equating to 50 per cent of their highest balance.