Where can savers find good value?

Apparently this is the standard question to ask a celebrity when trying to show how detached they are from reality.

I have to admit that I failed a similar test the other week when with a leading SIPP provider. Apparently they are paying 0.65%pa gross on cash balances. I questioned whether that represented good value, only to be put in my place. I still don't think 0.65% is very good but it is what it is.

Now it got me thinking about savings rates and did savers really understand how low rates had become for instant access accounts. Have savers really woken up to the fact that returns being paid on savings are generally at record lows? Just compare the early months of 2010 with the corresponding numbers during 2008.

Additionally there can be no denying that the position is further exacerbated with inflation at 5%, the fact that so few accounts are delivering a meaningful return, and at present a real loss, will surely be of pressing concern to advisers and savers alike. You have to concede that with equities not having performed for a decade and rates under pressure, many will be living off capital.

I think investors are now coming round to the fact that it will be difficult to get a real return (i.e. positive return once inflation is taken into account) without taking risk either to return, capital or both. Different clients will have differing attitudes to how they want to achieve this higher return.

This is where the structured product world comes into its own. In this sector savers are all too familiar with locking up monies for fixed terms or to have notice on access. 'You can't get out' is criticism often laid at our door but is surely less relevant here, assuming, of course, terms for doing so are attractive.

I have mentioned before that 6% had become the new 8% etc and, as reality starts to kick in for investors, I think structured products will start to take their place alongside mainstream investments. Solutions being put forward by structured product providers have relevance to today's savers and investors.

Colin Dickie is managing director, Barclays Wealth