Last year was hardly a banner year for bank savings account customers. Interest rates scraped the bottom of the barrel and customers grew frustrated with lousy returns. But this is a new year, with some slightly better news for bank rate investors – starting with five savings accounts that are actually worth a good, long look.
Unfortunately, fewer Americans are taking that “longer look.” According to a new study by American Express, Americans will set less aside for saving than they did in 2010.
It’s a pretty big decline, Amex reports. “After setting aggressive savings goals for 2010 – $14,000 on average – consumers are paring back their savings target this year to a more modest $2,600,” the study says.
A cynic might think banks themselves are to blame. For too long now, banks have offered miserly interest rates to customers – often way below even 1%. Increasingly, consumers may be shrugging their shoulders and asking themselves “why bother?” when savings rates are so low.
That trend looks to be slowing, if not reversing, in 2011. More and more banks appear to be getting aggressive about savings account rates. Not all of them, but more than industry observers noticed in 2010.
So which banks are offering the best deals? Here are a few highlights. For a complete list, check out the BankingMyWay Savings Rate Search tracker.
American High Yield Express Personal Savings
With an APY of 1.30%, American Express (Stock Quote: AXP) is out with a highly competitive rate that should draw interest from bank customers, since the average U.S. savings account rate is a weak 0.18% right now, as measured by the BankingMyWay Weekly Savings Rate tracker.
Discover Bank Online Savings Account
Discover (Stock Quote: DFS) bills its signature online savings account as having an interest that’s five times higher than the national average. With a current rate of 1.25%, they’re just about on the money. You’ll need a minimum of $500 to open the account, and, as with most bank rates, the rate can change on short notice.
ING Direct Orange Savings
When you think of online savings accounts, it’s hard not to think of ING (Stock Quote: ING) right off the bat. ING was one of the first financial institutions to get into online banking and it seems committed to making itself an online brand. Right now, you can get a 1.01% APY, with automatic savings withdrawals, a highly user-friendly online interface, and plenty of other benefits.
Some other good deals include WT Direct High Interest Savings Account, with a savings rate of 1.21%, and Ally Bank, with a rate of 1.25%.
If you’re looking to save more money, the banks listed above have some of the best deals on the market right now. No, you won’t get rich on these savings rates, but you will get richer – and that’s the name of the personal financial game these days.