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Yeah; when are THOSE coming back??? My parents kept their money in savings (as am I, at the moment) and that's how they made the bulk of their wealth; CDs were actually earning 12% at one time!
Yes and I remember 6.75% interest on savings account at credit unions. Maybe 5 or so at banks.
Until recently I had two internet bank savings accounts, one paid 0.45% interest, the other 0.5% but the latter had 1 year CDs at 0.6% which is where I put most of that -- a series of twelve 1 year CDs.
In the past couple of weeks the CDs have started converting at 0.75% so rates are creeping up. However most brick and mortar banks still un-ironically pay 0.01% interest. The local credit union will give you 1.5% on the first 100K if you use their debit card liberally enough and have at least one auto pay set up with their bill-paying service. After that its 0.05%.
One can get 2.5% or so from short term bond funds but even that is a long way from keeping up with inflation.
IIRC, those same savings accounts mentioned above peaked out at about 2% a few years ago before the fed lowered the base rate to practically zero. Somehow I doubt it's ever going to be north of that again -- or if it is, prices will be so sky high it won't be cause for celebration.
Yes and I remember 6.75% interest on savings account at credit unions. Maybe 5 or so at banks.
Until recently I had two internet bank savings accounts, one paid 0.45% interest, the other 0.5% but the latter had 1 year CDs at 0.6% which is where I put most of that -- a series of twelve 1 year CDs.
In the past couple of weeks the CDs have started converting at 0.75% so rates are creeping up. However most brick and mortar banks still un-ironically pay 0.01% interest. The local credit union will give you 1.5% on the first 100K if you use their debit card liberally enough and have at least one auto pay set up with their bill-paying service. After that its 0.05%.
One can get 2.5% or so from short term bond funds but even that is a long way from keeping up with inflation.
IIRC, those same savings accounts mentioned above peaked out at about 2% a few years ago before the fed lowered the base rate to practically zero. Somehow I doubt it's ever going to be north of that again -- or if it is, prices will be so sky high it won't be cause for celebration.
It appears that banks do not need to raise interest rates, regardless of the fact that the Fed will need to raise them at accelerated rate soon, because banks are full of cash. People have such an excess of cash deposited in banks, compared with pretty low volume of loans, that banks do not need to incentivize depositing any more cash into their accounts. I think it might be the result of shrinkage of middle class in the US. There is a certain % of population who are comfortably off with debts paid so they do not need loans (like many of ourselves oldsters in this forum ), and then there is a huge population that has no assets or income to speak of, so cannot qualify for loans (and lives off of the taxpayers). The old middle class practice of getting a mortgage & loans for other things at the beginning of adult life, and then working 30 years to pay off the debt, seems to not exist much any more. So the banks are scratching their heads, wondering what to do with all the money nobody wants to borrow. I am not optimistic about any kind of bank interest rates in this situation, but who knows .
There's too much money in circulation. The Federal Reserve pumped over $3 trillion into the economy...created money from thin air and spent it on Wall Street.
Now they have to reign it in...via higher interest rates.
There's too much money in circulation. The Federal Reserve pumped over $3 trillion into the economy...created money from thin air and spent it on Wall Street.
Now they have to reign it in...via higher interest rates.
Sure, something they should have done when the inflation reached 3.5%, not 7.5%. But it sounds as though banks will not follow the Fed with raising interest rates in savings accounts and CDs (or at least will raise the rates extremely little) because the banks have too high deposits, and too few loans. If banks are full of money, and nobody is borrowing from the banks, then banks have no incentive to raise interest rates. Banks only benefit from your deposit if they can loan it to someone else at a higher interest than they are paying you on the deposit. If they can't loan your money to anyone, they don't care to have your money, and certainly not to pay you interest on that money.
I'm not retired. Girlfriend and I are $185k in rural western NC. I still have my east TN condo. These food prices are killing her trying to feed a 400 lb. son.
I'm not retired. Girlfriend and I are $185k in rural western NC. I still have my east TN condo. These food prices are killing her trying to feed a 400 lb. son.
There's never been a better time to start a diet! Intermittent fasting is highly recommended.
I'm not retired. Girlfriend and I are $185k in rural western NC. I still have my east TN condo. These food prices are killing her trying to feed a 400 lb. son.
This is the worst inflation I've seen in 40 years dating back to 1982 or so. .... Seniors were already struggling to feed themselves before this inflation hit. How are members in here coping with these spikes in the COL?
With 5 days to go before getting my first SS check I'm so glad I waited until 70yo to claim. It will be somewhat short of the max amount & account for somewhat less than 50% of my future income stream. That means that almost half of my income will be adjusted for inflation annually & taxed beneficially. It also means that I'm less dependent on stock market volatility for the future.
While I certainly dislike the current pace of inflation & low interest rates for savers, I feel a bit "lucky" in that my SS is starting soon after this inflation really started. Plus I-Bonds available this May will likely be accruing more than 7.5% for cash savers.
Plus I-Bonds available this May will likely be accruing more than 7.5% for cash savers.
Thanks for mentioning those; I had forgotten about savings bonds and had not heard if I-Bonds. You are limited to $10K per year, but that is a good interest rate, even if you have to cash out prior to 5 years, or even really 1 year -- compared to savings accounts or CDs.
I love my coping method: I recently started part-time at a coffee shop. The person closing (most of my shifts are closing) gets first "dibs" on expiring foods. We sell a couple of quiche, egg or bean based burritos, sous vide eggs (which is like a contained poached egg with a few additions like cheese, green onion and sausage) and then we have various scones, croissants, cookies and other baked goodies. We also sell a drink made with orange peel and at the recommendation of a coworker I've begun taking the orange home instead of composting it at night. So in addition to cash tips (I average about $40 per day) I'm also bringing home about $30-$50 of food and I'll freeze everything except the sous vide eggs. Of course I also get coffee. I get two espresso drinks (any size and style) and free drip coffee per shift. I usually drink the drip and give the espresso drinks to my husband and my son. Since the store is in our neighborhood, it's just a 2 minute drive or 15 minute walk.
Oh and once a month we can take home a free bag of beans.
I was stressed out the first month learning everything, but it's not hard and my body has adapted to the specific movements of pulling shots. It's not much more effort than being the check out person at Costco which are often retirement-age. Sometimes you have to lift 10 lb bins of coffee and 6 pack of alternate milks. I do free youtube workouts on a channel called Fitness with PJ. She's oriented to women in their 40's, 50's and above (she's over 50 herself) and she has you lifting about that weight (or a lot more!).
Good shoes for standing is really important. My Sketchers from Costco work well.
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), and then there is a huge population that has no assets or income to speak of, so cannot qualify for loans (and lives off of the taxpayers). The old middle class practice of getting a mortgage & loans for other things at the beginning of adult life, and then working 30 years to pay off the debt, seems to not exist much any more. So the banks are scratching their heads, wondering what to do with all the money nobody wants to borrow. I am not optimistic about any kind of bank interest rates in this situation, but who knows 
.
