Getting Paid to Save

  • Our feed from Bankrate included an article about negative interest rates. If you're not familiar with that term/strategy it's the government's attempt to boost a sagging economy. Savers are actually charged for storing their savings at the bank. In other words, they earn negative interest on their savings. It hasn't happened here yet, but the article quotes Warren Buffett as saying that it might be better to store your savings in a mattress if it does occur.

     

    If you've saved some money, you know that banks are paying very little on savings for the last 8 years. That wouldn't be so bad, but inflation has actually been higher than what you earn on savings. So your savings are actually worth less each year. To quote the article “since October 2009, the annual rate of inflation has fallen below the average MMA yield just a handful of months. So while you don't have to look at your statement and see a negative rate, as some account holders overseas may soon be doing, every year you keep your money in a low-bearing savings account diminishes its real-world buying power.” You can read the article here.

     

    If you'd like to see if you could get a better rate for your savings you can compare CD rates here or compare Savings/Money Market Account rates here.

    Keep on Stretching those Dollars!
    Gary

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