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Passbook and statement savings accounts hit
record lows
By Laura
A. Bruce • Bankrate.com
Ah, the good old days. Fifteen years ago you
could get a whopping 5 percent or better on your passbook or statement
savings account. Of course, you were also paying about 10 percent
for your mortgage back then.
The latest survey by Bankrate.com shows traditional
savings accounts now offer interest rates in the neighborhood of
1.5 percent, the lowest since Bankrate began tracking these rates
in 1987. Not a neighborhood you should move into.
 There's
really no reason to stash your cash in a low-interest-rate savings
account. Money market accounts and certificates of deposit will
give you a much better return -- more than double the interest --
and keep your money just as safe.
Just as with passbook and statement savings,
your money market account and CDs are federally insured. You'll
sacrifice some liquidity with CDs, but money market accounts will
give you instant access with no penalty for withdrawals.
Money market accounts are very much like traditional
savings accounts except that you can write checks on them. You'll
have to be careful about how many checks you write; some institutions
limit the number of checks that can be drawn on the account within
a certain period.
Some institutions will give you ATM access to
your money market account.
Bankrate.com makes it easy for you to find the
best rates in your state and across the country. We continuously
update our listings of the highest
money market accounts and CD
rates.
If you're determined to have a traditional savings
account, of course we can help you there, too, with our section
on passbook and statement savings rates.
While you're browsing, take a peek at our checking
account study for the best fees. Just one more way to save you
money and give you the biggest return on your hard-earned dollars.
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