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Savings account interest rates

Started by fluidpowerpro, January 23, 2023, 03:12:03 PM

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fluidpowerpro

Just wanted to say that if anyone has any money sitting in a savings account that was opened years ago, it might be worth while exploring moving it to a new higher interest account. If your like me, your guilty of putting money in an account and then just leaving it sit.

 Since interest rates are rising, today I spent a little time looking for a higher rate of return.
 I have one account where all of it is done on line. After looking at the same banks current offering, it took me all of 10 minutes to transfer my current balance to a new account that pays over 10x what I was earning before. This was all using the same bank.

Unless you look into it yourself, they will gladly let your money sit there while paying you almost nothing.
Change is hard....
Especially when a jar full of it falls off the top shelf and hits your head!

btulloh

That's a real good point. It's real easy to just money sitting in accounts that are still paying extremely low interest rates. I've been moving money into money market accounts and cd's that are paying 4% or better now.  Generally won't find these at your bank but at your brokerage account. These cd's are issued by banks, but only available through your brokerage account. 
HM126

SwampDonkey

More interest means tied up money. Day to day living money in an account don't pay much. In the 80's that kind of money paid 18%. Them days are gone.
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

btulloh

Very true SD. When they were paying 18% though, mortgage rates and auto loans were 20%, so . . .

The good thing about money market accounts is that funds are immediately available. Not quit so with the CD's of course. 

It's a tough time to figure out what to do with savings right now.  FPP is right on though about assessing your own situation. I think the current rate for my standard savings account is around 0.1% or less.  Might as well be zero.  Better options are available but the bank is happy to keep paying next to nothing if I let them. 
HM126

SwampDonkey

It was hard on the farmers for sure. All of them used operating loans to plant and harvest.

If the money market is a non registered account (not  a tax shelter) then yes. Usually within a week or less, not like an ATM withdrawl. I'm thinking mutual funds here, which is not really interest, you get whatever value the fund unit price is at withdrawal.

My point in my first post is that an account for day to day won't get you much. But you can put easily accessible money in an account for a few bits more. Won't be 6%, maybe 2%.
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

fluidpowerpro

In my case I went from .3% to 3.03% by just creating a new savings account and transferring it from the old account. Same bank...they just come up with a new name for the savings account and for some reason they can pay 10x the interest on it. Who knows why.
Change is hard....
Especially when a jar full of it falls off the top shelf and hits your head!

SwampDonkey

They do that all the time. Then in 6 months your back at square one. It's their advertising gimmick. :D
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

fluidpowerpro

So I guess I better keep an eye on it and transfer it again to whatever new account they come up with. I'll not forget about it like I did in the past.
Change is hard....
Especially when a jar full of it falls off the top shelf and hits your head!

btulloh

FPP, Is that a local bank?  That's a good rate for a savings account. I haven't seen anything close to that at my bank (BofA).

Money market accounts here in the US make funds available in 24 hours or less, for the most part. No doubt all the rules are different between the US and CA. 
HM126

B.C.C. Lapp

Quote from: SwampDonkey on January 23, 2023, 04:22:04 PM
They do that all the time. Then in 6 months your back at square one. It's their advertising gimmick. :D
SwampDonkey when that six months rolls around can you close out that account or CD and put it into new ones with the high rate again or would you have to pay penalties that would make that useless?

edited this to say i just read what fluidpowerpro said so I guess that is his plan.   I'd be surprised if that works because wouldn't every investor do that then?   
Listen, or your tongue will make you deaf.

fluidpowerpro

Quote from: btulloh on January 23, 2023, 04:27:48 PM
FPP, Is that a local bank?  That's a good rate for a savings account. I haven't seen anything close to that at my bank (BofA).

Money market accounts here in the US make funds available in 24 hours or less, for the most part. No doubt all the rules are different between the US and CA.
It's from Capital One.
The old account was called a 360D. The new account is called 360 Performance. I guess the D in the name really was a drag on returns.
Change is hard....
Especially when a jar full of it falls off the top shelf and hits your head!

farmfromkansas

I have been reluctant to tie up money for a long period b/c of all the predictions of a stock market crash.  Recent news of the de-coupling of the dollar to oil is another concern. All the gold sellers are saying to protect your savings by buying gold, but gold pays 0 interest.  The stock market has not had a real crash since 08, and it is now 15 years since, where the average crash was about 7 years apart.  Bill Clinton said they had broken the business cycle, but that did not stop it in 08.  My thinking is all the things the government has done will make the next crash much more severe.
Most everything I enjoy doing turns out to be work

bigblockyeti

I get offers periodically from Chase offering X dollars for setting up a new savings account with new money and/or setting up direct deposit.  The most recent offer was $15K of new, non Chase held money in a savings account & direct deposit gets you a $700 bonus if you keep the balance no lower than $15K for six months.  That works out to a pretty safe 9.1%APR in addition to whatever saving APR could be worked out.

stavebuyer

The 1 year brokerage CDs are paying up to 4.7 for a 1 year term. Longer and shorter a little less. Beats the .1 at the bank and sure beats the minus 20 the stock market paid last year.

fluidpowerpro

Quote from: B.C.C. Lapp on January 23, 2023, 04:29:02 PM
Quote from: SwampDonkey on January 23, 2023, 04:22:04 PM
They do that all the time. Then in 6 months your back at square one. It's their advertising gimmick. :D


edited this to say i just read what fluidpowerpro said so I guess that is his plan.   I'd be surprised if that works because wouldn't every investor do that then?  
I think what they are hoping is that most people make the same mistake I do and that being to stash money in a savings account for emergencies, and then forget about it.
This reminds me of an aunt I once had.
She would constantly be opening and closing accounts just to get the toaster or whatever else they were giving away. :D
Change is hard....
Especially when a jar full of it falls off the top shelf and hits your head!

fluidpowerpro

Quote from: bigblockyeti on January 23, 2023, 04:47:52 PM
I get offers periodically from Chase offering X dollars for setting up a new savings account with new money and/or setting up direct deposit.  The most recent offer was $15K of new, non Chase held money in a savings account & direct deposit gets you a $700 bonus if you keep the balance no lower than $15K for six months.  That works out to a pretty safe 9.1%APR in addition to whatever saving APR could be worked out.
That's a sweet deal.
Change is hard....
Especially when a jar full of it falls off the top shelf and hits your head!

KEC

I think I was 15 when my Dad let me round up a bunch of scrap metal on our farm and sell it. Got a whopping $ 45.00 and went to the bank and started a day to day savings account, in 1966. IIRC, not long after that, it was paying around 4.5 %, compounded quarterly. I had that account for many years, putting money in when I could to have to pay real estate taxes and unexpected expenses. I closed it out when they started not only paying piddly interest, but also charging a Service Charge if the balance dropped below $ 2,000.00 at any point during a statement cycle. I'm not an economy expert by any stretch, but I think that the banks simply do not want to service accounts with modest balances when they can borrow huge chunks of money from the federal government at low interest rates. 

stavebuyer

I just went through this exercise as I would rather keep money local but none of the local banks offer anything remotely reasonably. I get when prime was 0-1/2  percent fractional interest was the norm but those days have past. Inflation at whatever rate you want to argue is killing your savings. 4.7% is still going backwards, but not as fast as .5%

bigblockyeti

Synchrony bank has no minimum deposit CD's at 4.60 APY for 14 months which as mentioned is still going backwards but slower than many other secure options.  I like to flip equipment, usually under $4K, not titled and not something anyone would likely want or need to finance.  It can be fairly lucrative and I enjoy tinkering so it's a self funding hobby that keeps me from otherwise buying stuff that would depreciate.  It's hard to put an APY on something like that as I also have sweat equity in it and that is more than zero effort needed for money sitting and earning interest.  I know it's always over $40/hr but rarely over $200/hr, really just depends on the deal and the demand when I'm done.

Ianab

Quote from: stavebuyer on January 23, 2023, 04:49:16 PM
The 1 year brokerage CDs are paying up to 4.7 for a 1 year term. Longer and shorter a little less. Beats the .1 at the bank and sure beats the minus 20 the stock market paid last year.
We treat the sharemarket as long term strategy. If you get out after a bad year you have simply locked in your losses. For every -20 year there is a corresponding +30 year that people tend to forget. If you look at it over the long term, it goes up and there are generally dividends to reinvest, at least in the type of shares we are into. 
The local Govt backed retirement scheme is basically managed funds, with the fund managers spreading the savings across various types of investments. People that don't understand the market tend to see their "retirement" balance drop and want to shift their funds. They wont be retiring for 20+ years, and the fund will bounce up and down multiple times over that period. 
We did put off reinvesting some funds last year as the market seemed too high, and ready for a correction. The crystal ball trick is to decide when it's bottomed out and that's the time to pick up bargains. Our stocks are generally the more stable "blue chip" stuff. Not high risk / high reward, but generally steady returns, on average. 
Weekend warrior, Peterson JP test pilot, Dolmar 7900 and Stihl MS310 saws and  the usual collection of power tools :)

stavebuyer

Agree that stocks are long term and trying to time the market is a plan to fail. If you bought your stocks over time and not all Jan 1 2022 then the amount you "lost" last year is a matter of perspective. Your account could still be showing a nice gain over the last 5 years compared to your input. The market will recover and gain, but will it be 5 months or 5 years? My personal take is that 5% interest will best the overall market in the short term and being at the "withdrawl" stage of life changes what is prudent. At age 30 buy the SP and let it ride. Age 65 maybe not so much.

SwampDonkey

I've been in mutual funds for years here, and yes markets go up and down, but over the long haul I have quadrupled my money with low risk funds. I don't have a lot of money wealth, but I do in assets, which are all free and clear of any debt against them. But even a few thou quadrupling feels nice. :D I also have a small life insurance that has a cash in value, had that for years to. Small little premium a year, but worth triple what I put in over the years. Plus in another 10 years and that more than doubles again around pension time. ;D
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

stavebuyer

Over the last 30 years my farm and timber tracts have netted me around 12% annual growth in value(timber/rent/appreciation). May be better financial rewards than dirt and trees but not for this country boy.

Cedarman

I have 3 month CD's paying a little over 4.5% and 6month CD's paying about 4.65%.  If I need quick money I can use credit line costing 7.5%.  First CD comes due end of Feb.  I can renew for 6 months and only have to wait 3 months for next CD. So I always can get 1/2 my money in 0 to 3 months depending on my maturity date, but make interest at the 6 month rate.
I am in the pink when sawing cedar.

TroyC

I use an on-line money market (savings account) that pays just under the treasury bill rate, It's variable, goes up and down depending on the FED. Insured so I sleep well. Lately it pays more than beer money every month!

stavebuyer

Another reason I am a little pessimistic on stocks is it seems many of the business leaders seem more concerned with social and environmental issues than the bottom line. Fund managers and investment bankers on Wall Street are measuring their investment decisions based on those metrics. Can't see that ending well.

SwampDonkey

Real estate values have fallen close to 30% nationally in Canada the last few months. Interest hikes makes money scarce for purchases. But that 30% hasn't happened in NB. Stat's indicate a 12% increase here.
"No amount of belief makes something a fact." James Randi

1 Thessalonians 5:21

2020 Polaris Ranger 570 to forward firewood, Husqvarna 555 XT Pro, Stihl FS560 clearing saw and continuously thinning my ground, on the side. Grow them trees. (((o)))

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