The director at Thesis Asset Management said the “most sensible way” of saving for short-term aims was to use one’s cash Isa allowance.
Under government rules for 2012/2013, the limit is £5640.
However, Mr Gammon added: “For longer-term saving, placing funds in a stocks and shares Isa should provide greater returns.”
While consumers can get these Isas directly from the fund provider, Mr Gammon warned it might be best for consumers to seek specialist help from a wealth manager or platfom.
His comments came after data from independent investment website savingschampion warned there have been 338 rate cuts to existing savings accounts, with 145 planned for March alone, despite the bank base rate having remained static at 0.5 per cent for four years.
Anna Bowes, former financial adviser and co-founder of savingschampion, said: “Some Isas available have good rates, such as Coventry’s 2.8 per cent notice Isa and Halifax’s fixed-rate Isa, paying up to 3.1 per cent.
“However, what a way to reward loyalty: M&S’s advantage cash Isa was paying 3 per cent before December; now, it has dropped to 2.25 per cent and is set to go to 1.3 per cent in May.
“While measures to increase lending could encourage economic growth, a negative interest rate could prolong savers’ suffering as a result.”
