The past Year has seen a rise in interest rates that has not been experienced in many years. This rate which is referred to as “The Federal Funds Rate” is the rate of interest that the banks use to lend money to each other and this rate is controlled by the Federal Reserve Bank.
For a very long time that rate was at or close to zero percent and now that rate today is 4.50-4.75%. That is a significant difference, affecting and creating a higher cost of loans and related debt. But there is another affect in that the rates on savings are now much higher than they have been for many years. Savings is again now “An Asset” that you should review and manage just as you would other types of assets such as Your retirement accounts. A change of earning .2% to 4% will certainly put more interest and growth in Your pocket. A few helpful points to manage these “savings”:
1. Shop and Check around to see what is available for savings/money market rates so You know what to expect or ask for.
2. Ask Your current Bank or Credit Union for a review of Your accounts and to see what they can offer to You.
3. Review your savings plans and match what You are doing to Your goals. Example: If you don’t need some of the saved money now, maybe you could use some of the savings in that 12 month CD for higher rates.
4. If you need some help or guidance, we get these questions a lot and are always happy to help. And if You don’t have success finding a solution we could help You with that also.
We hope this information is helpful for You and we have an open door policy, feel free to reach out at any time.
Thank you!
