Don’t Choose a Checking or Savings Account for Just 1% Interest
Banks don’t offer interest rates as high as they used to, so we tend to get excited when we see something above 0.25%. Several banks and credit unions may offer rates up to 1%, which is great, but that shouldn’t be the only reason you choose an account.
Forbes reminds us that a handful of small print goes to savings accounts with an interest rate of 1%. They give one specific example:
For example, the attractive 1% interest rate is only for accounts with a minimum amount of $ 2,500. On small accounts, the interest rate is only 0.25%. In press releases circulated prior to the launch of the Summit, the fact that the smallest accounts generate 75% less percent than the larger accounts was put in a footnote. It was completely removed from the list of commissions and interest rates that I requested the day before launch. Of course, the average checking account is larger than that, but we live in a world where you are charged high fees for low balance sheets, which means that about 30% of American households have no or no access to banking services.
Also, even if you have enough in your account, you are not going to earn all that much from 1% APY if you have tens of thousands of dollars in your account and you probably don’t need a lot of cash in checkout .
This does not mean that you should not use a higher interest rate. Even if you make $ 50 a year, it’s better than nothing. But there are other priorities you should consider when buying a new savings account: monthly fees, ATM access, transaction limits.
Want 1% interest on your checking account? You can get it, but be sure to read the lovely seal | Forbes