: Banks are guaranteeing rates over 5% on savings accounts into 2024. Here’s the fine print.

by | Oct 25, 2023 | Stock Market

It’s easy to find high-yield savings accounts that are offering 5% interest these days, but a handful of banks are now promising they’ll pay at least 5% interest on those accounts — and keep doing that into next year. While the Federal Reserve’s next interest rate move remains to be seen, earning a sure yield into 2024 sure sounds tempting.

Just read the fine print about the terms on these accounts, experts say. Savings accounts, like bank certificates of deposit, have been having a moment in a time of rising interest rates and rocky stretches for the stock market. CDs can be an enticing way to secure the benefits of higher interest rates, but the money is locked up for a certain period of time and there are penalties for early withdrawals. Savings accounts have no early withdrawal rules, but their interest rates can easily swing higher or lower at a bank’s discretion. So a chance to maintain a particular annual percentage rate on a savings account for a period of time combines certainty with an ability to tap the cash. Banks promising that a savings account will keep the same interest rate over a set period of time isn’t new, said Ken Tumin, founder of DepositAccounts.com. What’s different now is that “the rate is more aggressive than it has been,” surpassing 5%, he said.Which banks are guaranteeing rates …

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