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Scots `least likely to pay debts with savings`

03/09/2007

Scots are least likely to use their savings to pay off other debts, a new survey has revealed.

Those from Scotland and the north of England are finding other ways to pay off debts, rather than use their savings while the high cost of living is driving Londoners to raid their savings accounts to pay debts, research from Birmingham Midshires has found.

Rising interest rates are making more people turn to savings to pay off mortgages and credit card debts, with the over-55s the worst offending groups, taking four times as much from their savings as under-30s.

Jason Robinson, director of savings operations at Birmingham Midshires, said: "While homeowners are feeling the pressures following Bank of England rate decisions, there has never been a better time for people to put away their money. Interest rates at a six-year high mean great returns for savers, whatever amount you can afford to put away."

The Bank of England has raised interest rates five times in the last 12 months, with current rates at 5.75 per cent. Its next decision on interest rates will be taken on Thursday.

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