Bank deposits have long ceased to be quite profitable investments. Due to the fact that the Federal Reserve regularly raises the interest rate, many banks offer savings rates that barely cover inflation costs. Therefore, in order for your money to work for you, you will need to find the best savings rates that banks can offer.
Many people, having visited several large banks, think that it is no longer possible to find an interesting offer for savings that could allow them to increase their savings.
However, there are many small banks in the USA that you might not have heard of before, but offering deposit conditions that will benefit its customers. You can get a certain income by simply depositing your money in a savings account with such a bank.
What do small banks offer?
Now in the US, small banks are those have total assets do not exceed a billion dollars. According to researches, such banks offered on average twice as high rates on liquid accounts as large banks. CD for 1 and 5 years, savings accounts and checks are more profitable to implement one of the small banks, where you find the best savings rates.
In recent years, large banks with assets ranging from 100 billion dollars have lowered rates on liquid accounts to near zero values. This makes their use not interesting in terms of the growth of your money.
Why do small banks offer best savings rates?
Too low prices or favorable conditions are always alarming, although they are very attractive. How and why can small banks offer lower savings rates than large banks?
This is due to the greater need to attract many new customers than is necessary for large banking networks. Small banks can’t offer their customers a well-known brand with a reputation, as well as a developed network of its branches, conveniently located close to home. Also, often large banks offer a wider range of services that are not available in small ones.
These differences force small banks to set best savings rates to pull customers from large banks to themselves and hold them. This is quite difficult to do, because people are more likely to believe in brands, and also they don’t like to change their habits. Only significant benefits can force the average person to change the bank in which he is served.
Conduct your expertise
Even the best savings rates are not worth putting your money at great risk. Do not trust their first company, just because of the attractive numbers in advertising. As a rule, small banks are more susceptible to various influences and are more likely to go bankrupt than large banking networks.
Bank depositor’s money are insured with Federal Deposit Insurance Corporation. The amount of insurance covers up to 250 thousand dollars, but this does not apply to all types of investment. Check with the FDIC exactly what types of deposits are insured before investing your money.
In 2018, the economy was on the rise, it is expected that in 2019 this trend will continue, so now there is less risk of bank failures, however, examine the state of affairs of the small bank in which you intend to place a deposit, as well as all the terms of it.
Sometimes, despite the best savings rates, having high bank charges can greatly reduce your deposit benefits. Before you bring your money to a specific bank, carefully review its offer and all terms and conditions, especially those printed in footnotes in small print.
At the beginning of 2019, banks offer an average of 1.44% for deposits, and the best offers of small banks reach a 3.6% return on your money. This is noticeably different even from the national average rates, while the largest banking networks offer rates from 0.6% per annum on your savings.
Transfer your money from current accounts to more profitable deposits in order to reduce losses upon return of money. Get to know savings bank rates so you can always make money on your investments with the least risk.
The picture is constantly changing
Do not forget that the best savings rates are not something permanent. Rates may vary depending on various influences. Changes in the economy, both in the United States and in the global economy, immediately affect interest rates. They may decrease or increase if the Federal Reserve System changes the interest rate for banks.
Be always aware of economic events and changes in the conditions of your savings in banks. So you do not miss anything important that will allow you to get the maximum possible benefit from your money. Learn the offers of different banks, choosing a deposit. Pay attention to small banks, they usually offer savings accounts with a higher interest rate.
Expand your financial capabilities
There are so many opportunities around that we don’t know or that we don’t notice. Often, small companies can offer more favorable terms for their customers than big famous brands, as they need to attract more new customers.
Even if you are already dealing with a large bank and you are satisfied with everything, learn the terms and interest rates that are on the market. Sometimes you may be wondering how much extra money you could make using the services of other banks or companies, getting the best savings rates.
The same applies to loan offers and interest rates. If you need financial support, use the application form on our website and find out about the opportunities available to you. Read our financial blog to learn more about personal finance and how to streamline and increase it.