As savings rates continue to rise, many investors contemplate allocating more money into risk-free savings accounts instead of dicier assets, such as stocks.
The Federal Reserve has raised interest rates to curb inflation and improve economic growth. We are currently at the highest savings rates in 15 years, the highest levels in decades.
Today’s savings rates are significantly higher than in recent years. While the specific numbers offered will vary depending on the bank and account type, many banks now offer percentages well above the national average.
The S&P 500, often used as a benchmark for the stock market, has returned an average of around 12.3% per year since 1926.In contrast, competitive bank savings rates are currently between 4-5%.