Homebuyers have had another year of record low mortgage rates. The Bank base rate has now been at 0.5% since March 2009. This should have enabled many to reduce their mortgage or pay off expensive credit card and overdraft borrowing.

Low interest rates, however, reduce returns for savers. At the end of 2010 inflation as measured by the Retail Prices Index (RPI) was 4.8% making it impossible for savers with cash deposits to keep pace with inflation. This has a particularly negative impact on pensioners who rely on savings for income.