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Savings Rates

All articles tagged with #savings rates

personal-finance2 years ago•3 min saved

The Surging Popularity of 401(k) Hardship Withdrawals: A Risky Financial Move

Retirement account balances have rebounded in 2023, but the share of participants taking hardship withdrawals from their 401(k) plans has increased, according to reports by Fidelity Investments, Bank of America, and Vanguard. Experts warn that hardship withdrawals are the worst way to access funds from a 401(k) due to potential tax consequences and the inability to repay the money. While average 401(k) and individual retirement account balances have risen, the rise in withdrawals indicates ongoing financial strain for many households. Financial experts advise exhausting all other options before resorting to hardship withdrawals, as they can undermine retirement security and the power of compound interest.

via CNBC|

#401k #financial-strain #hardship-withdrawals

finance2 years ago•5 min saved

The Decline of High CD Rates: Experts Predict the End of Attractive Savings

Experts predict that savings rates, particularly high-yield savings account rates, will likely decrease in the near future. While the Federal Reserve's decision does not directly influence savings rates, banks typically adjust their rates in response. Some banks have already started lowering rates, while others may continue to raise rates to remain competitive. It is recommended to shop around for the best savings rates and consider alternative savings options such as brokerage money market funds or long-term certificates of deposit.

via CNET|

#certificates-of-deposit #federal-reserve #finance

finance2 years ago•5 min saved

Experts predict high savings and CD rates to continue despite Fed rate hikes.

Experts predict that the Federal Reserve will pause its rate hikes, but banks may continue to push high-yield savings account APYs over 4.00% and certificates of deposit over 5.00%. Banks are likely to keep pushing rates higher to stay competitive and keep deposits, but how high will rates go, and how long will they last? Some online high-yield savings accounts can earn 5.00% APY for a limited introductory period, but unlike CD rates, savings rates may decline sooner.

via CNET|

#banks #cd-rates #federal-reserve

finance2 years ago•5 min saved

Rising Bank Rates and Nationwide Failures: Implications for Personal Loans and Small Businesses

The recent crisis at Silicon Valley Bank has led to some banks increasing their savings account and CD rates to incentivize customers to stay put or to attract new money to replenish reserves. Some online banks, in particular, have increased deposit rates because it’s easier for their customers to move money to competitors. The effect of the crisis on savings rates can be difficult to isolate because bank interest rates were already climbing significantly in the past year as the Fed has hiked its key short-term rate by 4.75 percentage points to fight inflation.

via USA TODAY|

#cd-rates #deposits #finance