The best time for saving is not necessarily the time when rates are high as inflation eats into the gains made. But nor are low rates good for saving either.

New research from the Halifax, the UK's largest savings institution, has looked at how savers have fared over the past 40 years and what impact inflation has had on the rate of interest paid to them.

The main findings of the research are as follows:

• Savers got both the best ‘real’ and ‘nominal’ rates of return during the 1980’s. The best ever year for savers was in 1986 when the real rate of return was +7.5%.
• Savers were hardest hit during the 1970’s. Due to the ravages of inflation, savers enjoyed positive ‘real’ rates of return for only two out of the ten years. The worst year ever for savers was in 1975 when the real rate of return was an amazing minus 14.1%.
• Competition only really started in the savings market in the mid 1980’s. The collapse of the building society 'cartel' in October 1983, coupled with competitive pressures from new entrants really shook up the savings market.
• Savers now have more choice of savings accounts than at any time in history. They can choose from a whole range of savings accounts (e.g. branch based, internet, telephone, postal, tax-free, regular savings, bonus accounts) - unlike the 1960’s and 1970’s when generally only branch based, passbook savings accounts were available.

Commenting on the findings, Cheryl Millington, Head of Savings at Halifax said: "The evidence suggests that savers have fared well during most of the last 40 years."

"What is very clear however, is that periods of high inflation eat into the real rates of returns that savers receive."