A stark financial warning has been issued to millions of UK households, revealing that savers with £10,000 or more in the bank are collectively missing out on nearly £32 billion in potential returns.
The Scale of the Savings Crisis
New analysis exposes a dramatic surge in the amount of money held in accounts paying one per cent interest or less. Between January and July 2025, the total balance in these low-interest accounts exploded by a staggering 578%, an increase of over £27 billion.
This isn't just about the total amount of money; the number of people affected has skyrocketed. The analysis shows that the number of individual accounts earning such minimal interest rocketed by 370%. By the end of July 2025, this figure had reached eight million accounts, a sharp rise from just under two million at the start of the year.
Who is Being Hit the Hardest?
The research, conducted by Spring, highlights that the problem is particularly acute for those with significant savings. A massive £24.5 billion, which represents 77% of the total amount languishing in low-interest accounts, is held in accounts containing at least £10,000.
Derek Sprawling, Head of Money at Spring, commented on the findings, stating, "The scale of money sitting in accounts earning one per cent or less is truly eye-opening." He emphasised the real-world impact, adding, "Savers with significant balances are seeing their money eroded by inflation, when it could be working much harder elsewhere."
Why You Should Consider Switching
The consequence of keeping a large sum in a low-yield account is severe. As Mr. Sprawling points out, many people could secure higher returns without having to sacrifice access to their funds.
He explained, "Our analysis shows that, while a small proportion of accounts hold the majority of these low-earning balances, millions of people are missing out on the benefits of switching to a more rewarding savings account without suffering meaningful downside."
To put it in perspective, the difference in lost interest becomes substantial as your balance grows. While a £100 balance would only see a £4 difference between a 1% and a 5% interest rate, that gap widens to a significant £400 in lost interest when the account balance is £10,000.
The message is clear: with inflation eating into the value of cash, leaving substantial savings in low-interest accounts is a costly mistake for UK households.
