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For the past three months, we were running a poll on the left sidebar of the site. This poll was seeking an answer to the question below:
What annual interest rate are you receiving on your savings account?
With savings account interest rates being almost sickeningly low these days, the goal of this poll was to make sure that we’re all doing the best we can in maximizing our savings account returns.
In the course of the three months that the poll was running, we received a total of 41 votes, with the answer distributions as shown in the pie chart below:
As you can see in the chart, the majority of people on My Personal Finance Journey are receiving an annual interest rate of 1% or higher. This is very good! Great job readers!
Second place was an interest rate in the range of 0.76% to 1%, and third place was an interest rate of 0.05% of less.
How Does This Compare With The Rest of The United States?
So, we were able to see that the majority of MPFJ readers are earning 1% or higher in interest on their savings account totals. Having established this, we then wanted to see how these numbers compare to the rest of the country.
According to BankRate.com, the national average interest rate for savings and money market savings accounts is 0.17%.
Examining the results in the pie chart above, over 78% of MPFJ readers are earning a higher interest rate than the national average. While this is a really good result, there is still room for improvement. With online banks such as ING Direct offering 1% interest rate savings accounts with no fees and no minimums, there really is no excuse for people in this day and age to be in any category below the 0.75-1% interest rate group.
Of particular concern to me is the 14.6% of voters in the 0.05% interest rate or lower category. These people are most likely not taking advantage of online savings account options. For example, Bank of America and Wells Fargo (some of the biggest brick-and-mortar US banks) savings account are only currently offering a 0.05% annual interest rate. For those readers that fell in to this interest rate category, I would highly recommend checking out the BankRate.com savings account comparison link above to find an online bank that is offering a higher interest rate. You can easily connect these online accounts to your brick-and-mortar bank’s checking account, and many of them are offering interest rates above 1% per year. Please let me know if you have any questions!
A big thanks to everyone for voting in the poll and generating some good on-site discussion about this very important topic.
The next 3-month poll (up now on the site in the same top left side-bar location) involves the topic of mutual fund expense/fee ratios. In today’s economy, many people use mutual funds to invest for retirement in their 401k and/or IRA accounts. However, since there are thousands of mutual fund options to choose from, it’s imperative to select funds that offer the lowest fees possible while still accomplishing your investment strategy. One way that I accomplish this is through the use of low-fee index mutual funds. But, more on that later after the poll results are tallied! I look forward to seeing how the voting goes!
How about you all? How does your current savings account interest rate compare with either the national average or the results of the site poll? Do the poll results seem consistent with what you’ve experienced as well?
Share your experiences by commenting below!