Personal finance experts from Money.com have compiled a list of the seven best savings accounts for 2023. This comes as interest rates have soared to record highs over the past year in response to the issue of inflation.
According to money.com, here are the best savings accounts currently on offer to customers as of April 14, 2023:
- Bread – 4.5 percent APY
- Barclays – 3.60 percent APY
- Ally – 3.60 percent APY
- PenFed – 2.70 percent APY
- Synchrony Bank – four percent APY
- CIT Bank – 4.20 percent APY
- Discover Bank – 3.60 percent.
The finance advice website broke down which accounts were the best “no frills” accounts with Bread and Barclays topping the list.
Bread Savings’ online savings account provides a high 4.50 percent (annual percentage yield (APY).
There are no maintenance fees for this account and a mobile deposit is available, however, a $100 (£80.37) deposit is needed to open the product.
The experts explained: “Bread’s high APYs come with a tradeoff: there’s no checking account available. This means that you must transfer the funds to another bank to withdraw the cash.
“Additionally, its mobile app is somewhat barebones, only offering basic account-management tools, such as the ability to check your balances and make transfers.”
In comparison, Barclays has a “no-frills” online savings account with a competitive APY of 3.60 percent.
Its certificate of deposit offers savers a favourable interest rate of 4.30 percent on a 60-month period.
Ally and PenFred were declared to have the best digital savings tools and top Credit Union, respectively.
Over the past year, the Federal Reserve has raised interest rates multiple times in a bid to control inflation.
Last week, inflation fell to five percent with the central bank’s interest rate currently being between 4.75 and five percent.
Experts have not ruled out further rate hikes due to the ongoing pressure inflation is having on consumers.
Concerns have been raised that continuing high Consumer Price Index (CPI) inflation is diminishing returns on savings for bank customers.
Josh Sneak, CEO of Rainwalk Pet Insurance, outlined why this should not deter savers from putting their money into savings accounts.
He explained: “Rising inflation rates have made it much more difficult for people, especially families or younger people making minimum wage, to save adequately for emergencies and for the future.
“I think this could be a real problem for the future, as people who may already be living paycheck to paycheck feel the increasing burden of inflation in their everyday spending.
“Lack of adequate savings can not only be a source of significant stress, it can also result in delayed retirement, inability to purchase a home or a car when needed, and other economic repercussions.”
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