Producing an income from our savings is vital, but we may no longer be getting the income we need from traditional sources.
Interest from savings accounts has fallen sharply since the global financial crisis, and in many cases the income from cash deposits is no longer able to keep pace with rising inflation.
As interest rates fall, your savings have to work harder to overcome inflation. While cash may still appear to be the safest option, keeping money tied up in low interest bank accounts may erode the value of any income produced over time and harm your long-term investment goals.
This may lead to future disappointment if you’re relying on your savings to supplement an existing income, perhaps in retirement, or reinvesting savings interest for long-term growth.
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