A History of Playing It Safe
It’s easy to see why people favour the familiarity of a deposit account. Many remember the 2008 crash and the loss of trust in financial institutions that followed. More recently, the Covid-19 pandemic caused another surge in household savings, with limited spending opportunities during lockdowns.
But today’s economic environment is different. Inflation remains stubborn. Interest rates have begun to fall again. And while mortgage holders are finally starting to see some relief, savers are being left behind.
A June 2025 statement from Brokers Ireland makes it clear: despite rising ECB rates last year, banks passed on increases to borrowers faster than to savers. And as rates now begin to fall again, depositors face a double hit – poor returns and eroded value.
It’s Costing Us
According to the Central Bank and Brokers Ireland, Irish savers lost out on nearly €800 million in unearned interest in 2024 alone. That’s money that could have been growing, or at least keeping pace with inflation.
The problem isn’t that people aren’t saving. It’s that we’re doing it in a system that quietly punishes caution. Unlike other EU countries, Ireland’s savings tax system creates major disincentives for those looking to move beyond the basics.
Currently, life assurance savings and investment products are taxed at 41%, compared to 33% Capital Gains Tax on stocks, shares and property. An additional 1% life assurance levy, first introduced as a “temporary measure” back in 2009, still applies and remains unique to these policies.
As Brokers Ireland pointed out in April 2025, these policies “contribute to bad outcomes for consumers“, and their removal is long overdue.
So why are we such sticklers for playing it safe?
There are many factors at play here. A lack of awareness. Fear of risk. A perception that investment is only for the wealthy. And in some cases, plain inertia. Banks know that many deposits are “sticky”, meaning they’ll stay put regardless of how low the rate gets.
There’s also a gap in financial education. Many people don’t know what alternatives exist, or feel unsure about how to access them. And while fintech providers such as Revolut and N26 offer more attractive interest rates, concerns about fraud and access persist, especially among older or less tech-savvy customers.
What Can You Do?
At Lynx, we understand that no two savers are the same. You might be saving for a home deposit, supporting your children through education, planning retirement, or simply trying to build a safety net.
Whatever your goal, the key is making your savings work harder, without taking unnecessary risks. You could start by:
- Reviewing your savings structure and identifying tax-efficient options
- Exploring diversified, long-term investments that suit your timeframe
- Moving funds into products that better reflect your financial goals
These aren’t speculative bets or high-risk plays. With the right advice, you can strike a balance between safety and growth.
Advice Makes a Measurable Difference
According to the Value of Advice 2025 report, individuals who work with a financial advisor have:
- 46% larger pension pots
- 71% more in savings and investments
- Higher financial confidence and better long-term planning
The reality is, most people who get advice don’t just grow their money, they gain peace of mind.
Planning for Today, Tomorrow and the Unexpected
At Lynx Financial Services, we believe financial planning shouldn’t be complicated or overwhelming. That’s why we take a personalised, straightforward approach, helping you save for today, tomorrow and the unexpected.
No jargon. No hidden fees. Just clear, honest advice tailored to your goals.
Whether you’re looking to grow your savings, invest with confidence, plan for retirement or protect your family, our experienced advisors are here to help you every step of the way.
Your financial security is our priority, and as a member of Brokers Ireland, regulated by the Central Bank of Ireland, you can trust that you’re in safe hands.
Want to make your savings work harder? Get in touch for a no-obligation chat.
Sources:
- Warning: If you invest in these products you may lose some or all of the money you invest.
- Warning: Past performance is not a reliable guide to future performance.
- Warning: The value of your investment may go down as well as up.
- Warning: Benefits may be affected by changes in currency exchange rates.
