savings
People with savings accounts in traditional brick-and-mortar banks saw interest rates on their deposits fall in the fourth quarter of 2016.
Meanwhile, during the same period, interest rates, including the Fed Funds rate, bond yields and mortgage rates all rose with inflation.
No one is saying an under-the-mattress cash stash would almost be as profitable, but it’s pretty close.
So, why keep your hard earned nest egg in an account earning next to nothing?
Based on the quarterly "America’s Best Rates" survey from MoneyRates.com, people looking to save have options. MoneyRates found banks that are offering accounts paying significantly more than the average rate.
“The rate environment is not great for savers, but one thing consumers have going for them is choice,” says Richard Barrington, senior financial analyst for MoneyRates.com. “There are many banks out there, and online banking brings new options to areas where choices previously were limited. Consumers can use that freedom of choice to earn more on their deposits, rather than just sitting back and accepting earning next to nothing on their savings and money market accounts.”
The ‘America's Best Rates’ survey found:
- The leading savings account is from Salem Five Direct Bank, which offered a rate of 1.10 percent, nearly five times the average rate of 0.227 percent.
- Online accounts are a good place to look for higher rates. The average rate on online savings accounts is 0.644 percent, which is nearly nine times as high as the average rate for traditional, branch-based savings accounts at 0.072 percent.
- Online money market accounts also have an advantage over their branch-based counterparts.
- Small banks offer rate advantages albeit not as clear a one as online banks; banks with $5 billion or less in deposits provide an interest rate of 0.328 percent, roughly 10 basis points higher than the overall savings account average.
See the full rankings, analysis and methodology for "America's Best Rates" here: http://www.money-rates.com/research-center/americas-best-rates/
DISCLAIMER: This article is for informational purposes only and does not constitute an endorsement of any entity nor does it constitute investment (savings) advice, if you need such advice, you should consult an accountant or investment professional. Insightful Accountant assumes no liability for the application of any content or information provided herein, at anytime.