Switch location / audience type

This content is not available based on your location and audience type.

You currently have access to view the Uk website for Independent Financial Advisers (IFAs).

If this does not apply to you, go back to our homepage.

Select a location
Select an audience type

Let us know who you are so we can optimise your experience.

Please select your audience type

This includes trust companies, fiduciaries, insurance companies, Wealth Advisers and other professionals.

For Canada and Australia select:
Important information

You are about to enter our website for professionals. If you would like to return to our main website, go back to our homepage.

Please read the terms and conditions before proceeding.

Please note these are subject to change at any time.

The information in this area of the website is aimed at financial advisers, corporate service providers, wealth advisers, and legal and accountancy professionals. It is not intended for direct use by private investors or onward distribution to retail clients or the general public. Please visit our homepage for information and resources for private clients.

The website is for information purposes only and is not to be construed as a solicitation or an offer to purchase or sell investments or related financial instruments.

I confirm that I am one of the categories of professional mentioned above, and that where applicable I am authorised and regulated by the Financial Conduct Authority or equivalent regulated body given my jurisdiction, location, and profession. I have read and understood the legal information and risk warnings.

By clicking the 'Accept' button, you agree to abide by the terms and conditions listed below.

Skip to main content

Global Capital Markets Investor Relations Wealth Management:  CA  |  AU 

Menu
UK

Do I need to protect my savings against inflation?

15 September 2021 in Inflation , Investing, Retirement & pension planning, Wealth planning

With UK inflation (as measured by the consumer price index) currently at 10.1% and the Bank of England base rate at 1.75% (as at August 2022), the value of cash savings is being eroded by more than 8% a year.

And with The Bank of England expecting inflation to reach 13% in 2022, the situation looks set to worsen if you are holding your wealth in cash.

This article explains how serious a threat inflation is to the value of your cash – and how you can protect your savings against inflation by investing.

How is inflation eroding the value of savings?

To understand the effect inflation can have on the value of cash savings, let’s look at what would have happened to the real (after inflation) value of £1,000 cash deposited ten years ago in an account paying interest at the Bank of England base rate.

Real return of cash graph 2022.jpgPast performance is not a reliable indicator of future performance.

Over the ten-year period, the real value of that cash would have fallen from £1,000 to less than £816 – a loss after inflation of more than 18%. That’s because, for much of the period, the rate of inflation outstripped interest rates.

If inflation remains higher than interest rates, cash will continue to lose its value.

Can savings beat inflation?

The good news is that there are alternatives to cash that may help investors offset the effects of inflation. Savers with excess cash in the bank may wish to see professional advice to explore the options open to them.

Find this useful? Read more about inflation: 

Get in touch to speak to a professional wealth adviser and see how we can help protect your wealth from inflation with confidence.

Speak to one of our investment experts

To discuss your investment needs, book a complimentary, no-obligation consultation.

Request a consultation

Investment involves risk. The value of investments and the income from them can go down as well as up and you may not get back the amount originally invested. Past performance is not a reliable indicator of future performance.

The information provided is not to be treated as specific advice. It has no regard for the specific investment objectives, financial situation or needs of any specific person or entity.

Charts are for illustrative purposes only and should not be relied upon for any other reason. Information is correct as at date of publication.

The information contained herein is based on materials and sources deemed to be reliable; however, Canaccord Genuity Wealth Management makes no representation or warranty, either express or implied, to the accuracy, completeness or reliability of this information. All stated opinions and estimates in this document are subject to change without notice and Canaccord Genuity Wealth Management is under no obligation to update the information.
Photo of Justin Oliver

Justin Oliver

Chief Investment Officer, Canaccord Genuity Funds

Justin provides direct assistance to the Chief Investment Officer in maintaining responsibility for the investment philosophy, process and methodology of Canaccord Genuity Wealth Management, and acts as the alternate to the CIO. He is Chairman of Canaccord Genuity Wealth Management’s Portfolio Construction Committee, a member of the Asset Allocation and Fund Selection committees and manages several of Canaccord Genuity Wealth Management’s Select range of funds. Justin is a Chartered Fellow of the CISI and is a former President of the Guernsey Branch of the Institute.


+44 207 523 4963
LinkedIn

Investment news updates

Investment involves risk and you may not get back what you invest. It’s not suitable for everyone.

Investment involves risk and is not suitable for everyone.