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Britons 'saving to fund holidays'

13/1/14

By Sarah Tawton

Low interest rates are not enough to deter Britons who are saving money for a holiday.

This is according to a new poll which found that 65 per cent of holidaymakers chose to save up to fund the cost of their trip.

The figure rose to 75 per cent among 24 to 44-year-olds, according to the survey for the Financial Services Compensation Scheme (FSCS).

The poll of more than 2,000 people who had recently been on holiday found that more than half (51 per cent) had managed to save up enough money to cover the entire cost of their break.

Interest rates at an historic low

But more than one in 10 (14 per cent) said they had only been able to save up some of the money and had to cover the rest by taking out a loan or paying on a credit card.

Savers have struggled to find any real returns on their money in recent years, as the Bank of England holds interest rates at an historic low of 0.5 per cent.

Those who are still saving can rest assured that the FSCS, the UK's savings safety net, will provide compensation of up to £85,000 if their bank goes bust.

FSCS chief executive Mark Neale said: "The financial aspects of going on holiday can be stressful as well as time-consuming.

Deposit protection checker

"It is important that holidaymakers are aware that regardless of how they save up or pay for their holiday, any savings with a UK-authorised bank, building society or credit union are FSCS protected.

"This will no doubt reassure holidaymakers and ensure at least this part of their holiday remains stress-free."

The FSCS, which is funded by an industry levy, has launched a new deposit protection checker which allows people to find out whether their bank, building society or credit union is covered by the scheme.


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