Yesterday, I received a notice from one of my banks letting me know that my once “highest interest rate around” which was why I decided to sign up with the bank in the first place was now offering 1.20% interest on my savings account. This is the second decrease in about 3 months.
The low interest rate should be of no surprise to anyone to see why people are shunning banks for saving. Since this is an online bank the only way to make a deposit I had to deposit money into an account and have it transferred since there is only one branch of this bank in Chicago.
Still 1.20% is better than nothing but not enough to make me transfer cash that I am saving for short term goals. When the interest rate was 3.55% about a year ago transferring cash that I received for my birthday or Christmas into the account until I decided what I wanted to buy made me feel as though my gift givers were giving me a little extra. Moving the money around for less than a dollar a month wouldn’t buy a coffee from 7-11.
The additional income which amounted to less than $12.00 for 2009 could be used for something else. Yet, moving the money around just to earn less than $12.00 or less than a dollar a month isn’t worth it. In a month, I find more in spare change (and will pick it up) and don’t have to report it as taxable income.
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