Savers didn't see much of anything happen this week. Average rates on 1-year certificates of deposit and money-market accounts, two frequently used savings products, stood pat. The average rate on longer-term 5-year CDs stood pat.
MMA rates stay put
The average interest rate on money-market accounts, which are savings accounts that often have higher rates than conventional savings accounts and come with limited check writing privileges, was 0.12 percent this week. That's flat compared to last week.
A month ago, the average rate was the same as it is now. A year ago, the average rate was 0.11 percent.
Earning meaningful income on your deposits has been an uphill battle for years now. Savers shouldn't accept a near-zero rates without a fight, however. There are FDIC-insured institutions offering rates multiple times the abysmal national average.
1-year CD rates stand pat
The average interest rate on 1-year CDs stood unchanged at 0.36 percent this week. That's higher than the 52-week average of 0.33 percent.
A month ago, the average rate was 0.35 percent. A year ago, the average rate was 0.29 percent.
Longer maturities followed suit. The average rate for a 5-year CD was unchanged at 0.91 percent. A month ago, the average 5-year rate was 0.90 percent. A year ago, it was 0.80 percent. Rates on three-year CDs, which split the difference between 1-year CDs and 5-year CDs, stayed flat at 0.63 percent.
As you can see, going for longer-maturity CDs can increase the interest you earn from your deposits. It's not all roses and sunshine, however; if you need to access the money before the term is up, you'll likely pay an early-withdrawal penalty, and if rates rise, you'll be locked into that lower rate for a while. One way to address those risks while still earning a decent return is through CD laddering.
It may go without saying, but FDIC insurance is a must-have for CDs, money market accounts and other deposit products. And if you find a rate you like at a bank that you've never heard of, Bankrate's free Safe & Sound ratings can help you do some digging into its financial situation.
Weekly savings and CD rate survey
|Results from Bankrate's survey of banks and thrifts conducted 7/26/2017.|
|Money market account||1-year CD||3-year CD||5-year CD|
|This week's rate:||0.12%||0.36%||0.63%||0.91%|
|Change from last week:||N/C||N/C||N/C||N/C|
Methodology: The "Bankrate.com National Average," or "national survey of large lenders," is conducted weekly. To conduct the National Average survey, Bankrate obtains rate information from the 10 largest banks and thrifts in 10 large U.S. markets. In the Bankrate.com national survey, our Market Analysis team gathers rates and/or yields on banking deposits, loans and mortgages. We've conducted this survey in the same manner for more than 30 years, and because it's consistently done the way it is, it gives an accurate national apples-to-apples comparison.
To learn more about the different rate averages Bankrate publishes, see "Understanding Bankrate's Rate Averages."