How can something as small as a tenth of a percent make a difference? Easy! When we're talking about interest on your savings. Let's take a closer look at just how important it is to shop around for a more competitive interest rate.
If you're like most of us, you receive a monthly statement from your bank that reveals just how little interest you're being paid. What used to be hundreds of dollars is now a one or two digit number. Maybe you don't even realize it, but your money market account might be paying as little as 0.20% (that's two-tenths of one percent). Even a one-month United States Treasury Bill was recently yielding less than one-tenth of a percent!
With interest rates that low, the only place to go is up. Don't just sit there and fret with each month's statement. Shop around just like you shop for groceries or other online bargains.
Let's do the math to see how much it can mean to your bank account.
Let's say your current bank account yields 0.20% and you have $25,000 in the bank. When you receive your monthly statement, you will have earned $4.16 -- enough for a slice of pizza and a soda. After 1 year you and your significant other will be eating at Olive Garden with the $50.05 that you earned.
Now let's say you use one of the many online interest rate search engines like bankrate.com. A quick search today showed a top rate of 1.44% from a four-star rated bank. In one month you will have earned $30. After 1 year, you and your whole family will be eating New Year's Eve dinner at the finest steakhouse with the $362.29 you'll have in the bank. By the way, one of our favorite banks is ING Direct. Also, check the top of this page for some other bank deals.
Now that's some pretty good eatin' just for doing a little shoppin'!