Savers can benefit from higher interest rates
It’s a good time to take advantage of high-yield savings accounts.
RENO, Nev. (KOLO) - The Federal Reserve has raised interest rates nine times in the past year, causing panic for many borrowers, home buyers and credit card users.
“Credit card interest rates right now, they’re as high as 20 percent,” said Michael Thomas, Senior Vice President of Communications at Greater Nevada Credit Union.
But there’s a silver lining for savers when it comes to higher rates.
“You wouldn’t have seen interest rates this positive, meaning four percent, five percent earning potential a year ago,” said Thomas.
Thomas says it’s a good time to take advantage of high-yield savings accounts and CD’s. Several credit unions and banks in northern Nevada are offering a 5% return.
A CD is a certificate of deposit which is good for someone who can let their money sit for a period of time.
“It really offers flexibility as long as you know you’re not going to need that money,” Thomas said.
“These are great options for people who might be saving for a down payment on a house and they know they’re going to put that purchase off.”
But there are also other ways to keep your money safe in an often volatile economy.
“Insurance products are really good for that,” said Sean Marler, a financial representative for Country Financial.
“There are lots of financial products that are good for just keeping money safe.”
Marler says it’s a good time to diversify your investment porfolio and consider savings accounts. He says you don’t need thousands of dollars to do it.
“We hear these words like annuities or life insurance products or money market accounts things like that and they think, ‘I have to have a lot of money’ and that’s just not true,” Marler said.
“You can open up a certificate of deposit or a high yield checking account with as little as a thousand dollars,” Thomas said.
While watching inflation and interest rates climb might be scary for some, Marler says it’s important to remember the economy always fluctuates.
“Just 20 years ago, being in a seven percent environment on mortgages was considered a great deal,” Marler said.
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