How high is the interest rate of savings accounts in 2023?


• The rise in the Federal Reserve ’s interest rate has led to rising interest rates for savings accounts.
• If these interest rates continue to continue, stores may benefit.

Inflation has tortured consumers for more than a year, so that many people have no choice, they can only bear expensive credit card debts in order to pay bills and foods. However, the Fed is doing its best to solve this situation.

The Federal Reserve has repeatedly raised interest rates to slow down. By increasing the cost of borrowing of consumers, people want to reduce expenditure to enough supply to keep up with demand. In this case, inflation should start to cool down.

In other words, higher borrowing interest rates are not a good thing for consumers. However, there is a line of hope that the Federal Reserve ’s interest rate hike will also lead to an increase in interest rates for savings accounts. There is reason to believe that this trend may continue in 2023.

Will the revenue of the reservoir next year be higher?

Before we continue, let’s find out one thing. The Fed does not directly determine the interest rate charged by the credit card company or the interest rate provided by the bank to savings accounts and CD deposits by banks. On the contrary, the Fed is responsible for the federal fund interest rate, that is, banks collect interest rates of short -term loans.

But when the interest rate of federal funds rises, consumers’ interest rates will rise. This is a good thing in the context of bank products, but it is not so much for loans and credit cards.

At the same time, in the past few months, the interest rate of many people’s savings account has risen. Similarly, the CD interest rate provided by the bank this summer is more favorable than earlier this year.

Since the Federal Reserve has not yet completed interest rate hikes, it is possible to fairly assume that consumer borrowing costs may become higher in the next few months or even 2023. But it is also a fair assumption that savings accounts will start paying more because they are excellent.

This is difficult to predict, and they will start paying more. Today, many high -yield savings accounts provide a 2 % annual interest rate. This was a significant improvement of this year. At that time, many stores did not even get 1 % of money.

It is difficult to determine the exact number that may reach the interest rate of savings accounts in 2023. But it is not unreasonable to think that they may climb to 2.5 % or 3 %.

Keep in mind that CD usually pays higher interest rates than savings accounts. Therefore, even if the interest rate of savings account does not increase much compared with the current interest rate, it may have the opportunity to make more interest by opening CD.

Should you save more money at a higher interest rate?

If you do not have a complete emergency fund, it is definitely worth your efforts to increase your savings. However, if you are ready in this regard, you may need to consider depositing the additional funds you own into the brokerage account.

Although savings accounts can be paid generously in 2023, you may get higher capital returns through investment brokerage accounts. Therefore, if you are talking about funds that do not need in the short term, saving cash into savings accounts may actually mean that you will get lower returns than you may receive.