Sunday, September 2, 2012

Interest Rates are Ridiculous

I blog mostly about stocks and investing since that is what interests me, but today I bought a CD. 

IT PAYS LESS 1%

That's right I bought a 18 month CD that pays me 0.95%.  This is money I will use to buy a different car in the future so I don't want to risk it in the stock market.  I need to have the principle left intact.  Here is a list of savings products I use.  The CDs mature at the same time (meaning I bought the 24 month CD six months ago).

36 Month CD 1.64%
30 Month CD 1.29%
24 Month CD 1.09%
18 Month CD 0.95% (just bought this one)

Savings Account  0.11% (Seriously? BAHAHA)
Checking Account 0.01%

Look at these atrocious rates, is it any wonder dividend stocks have performed well the past couple years?  Retirees need to find yield somewhere...

Oh and my bank advertises that the savings account pays twice the national average o.O

7 comments:

  1. I agree -- interest rates are laughable. I always chuckle when I'm in my bank and see a sign indicating their "competitive rates" for CDs that yield 1%. Competitive with what -- zero? :)

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    1. Unfortunately the joke is on me since I keep my emergency fund in a savings account and use these "competitive" cds to save for a car. It's a small price to pay for sleeping well at night I guess.

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  2. It may be different in the US but here in Canada there are a number of banks which offer high interest savings accounts that range from 1.35% to 1.80%. Plus you can access your money at anytime. I am surprised that there isn't also some US banks offering the same rate of return.

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    1. There are a few banks that offer rates that high in the US but they usually come with strings attached. I've seen some where you have to make a certain number of purchases every month on the associated card; things like that. I try to keep my life simple and do not want the added complexity.

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  3. My wife and I use DiscoverBank for our savings for our yearly property taxes. I guess I should be happy getting 0.8% on my savings. Coming close to the point where I might just leave it in my checking account since it's not gaining me all that much in interest. Really glad I'm not having to try and live off that 0.8%.

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    1. Yep, it might not be much but it's better than nothing. In my case the cds I own pay me next to nothing, but I'd rather gain it than pay it on a car note. Paying cash for a car is a wonderful feeling.

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