Buying a car is top reason to save

26 August 2004
Buying a new car, holidays and home improvements are the most likely reasons for saving money, according to new research.

A study by the financial services arm of motoring organisation the AA found that over 90 per cent of savers aged between 18 and 24 say a car is their top priority.

"For most teenagers, turning 17 means the time for L-plates, driving lessons and the bid for freedom," said Lloyd East, Director of AA Financial Services.

"It also means saving hard for their first big purchase and because they're at the bottom of the earnings ladder, every penny counts.

"Yet our research also shows that the majority of savers will find the poor rate of interest they earn on their account will tarnish the excitement of buying their first motor."

He continued: "Around 85 per cent of savers go to their current provider rather than shopping around for the best interest rate.

"Some accounts pay less than one per cent yet just to stand still against the Retail Prices Index they should be getting at least 2.88 per cent."
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