Chase and Bank of America, two of the largest banks in the United States, are falling behind when it comes to providing competitive savings rates for their customers. Currently, both banks offer an abysmal interest rate of just 0.01% (APY) on their savings accounts. Unfortunately, this means that customers don’t gain much from their savings, apart from the confidence in these systemically important banks that are unlikely to fail due to the guarantee of a bailout from the Federal Reserve.
However, there are alternatives available for those seeking better returns on their savings. Fintech company Raisin has created a savings marketplace that allows users to review offers from various banks without any geographical limitations. They are currently promoting a CD (Certificate of Deposit) offered by Mission Valley Bank, which provides a return of 5.42% for a one-month term. And for those concerned about liquidity, Raisin assures that this option offers ample flexibility.
Compared to the national average, the CD offered by Mission Valley Bank through Raisin is an impressive 24.6 times higher. Additionally, if customers prefer a more traditional savings account, Raisin lists several US banks that currently offer a 5.26% APY return on savings. It’s worth noting that all of these savings accounts are FDIC insured, offering customers peace of mind.
But what about the rates offered by well-known Fintech companies and digital banks? Let’s take a look:
– LendingClub: 4.5% APY
– SoFi: 4.5% APY
– Varo Money: 5% APY (up to $3000, 3.0% on the rest)
– Marcus (Goldman Sachs): 4.4% APY
– Apple Savings: 4.18% APY
Contrasting these rates with those offered by Chase and Bank of America highlights the significant discrepancy, making it clear that customers with these banks are essentially losing money on their savings. With the vast difference in returns, it may be wise for individuals to consider moving their funds elsewhere, away from banks like Chase or Bank of America, who benefit from the significant spread generated by such low rates. As is always the case, customers should carefully review the terms and conditions before making any decisions, as interest rates are subject to change.
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