0
Any Deposit account in a bank (except current/checking accounts) earn an interest. The deposit that you hold in your account is cash that the bank uses for granting loans and other services to other customers. Since the cash in savings accounts are very liquid banks have limited options of making money out of it and hence they give us very little interest on those accounts. Where as in case of CDs and fixed deposits the bank knows that a certain amount of cash is going to be in their holding for a certain period of time and can plan to utilize it effectively and hence the interest offered on them is much higher than savings accounts.
Wiki User
∙ 14y ago
Add your answer:
Earn +20 pts
Why is a CD better then a savings account?
Because they earn a higher interest rate than savings accounts. The interest on CD's is atleast 2-3% higher than savings accounts. On the downside, the money in your CD is not as liquid as your savings account and your bank may charge you a penalty if you withdraw the money before maturity date.
What is a type of savings account that pays a higher interest rate because the financial institution invests the money money you deposit?
There are numerous types of savings accounts that pay a higher interest rate, although this is not necessarily related to a financial institution investing your money; this is common for all banks and all accounts. Some higher yield savings options include money market accounts, fixed income investments, and CDs.
Why is it difficult for the fed to gather and evaluate information about M1 and M2?
The money supply is measured in terms of M1 and M2. New savings and investment opportunities have appeared. Keeping track of the growth of M1 and M2 becomes more difficult as money is shifted from savings accounts into interest-paying checkable accounts.
Do you want a high or low interest rate in a savings bond?
If you are investing in a savings bond, you wish for it to have a high rate of interest. If you are selling savings bonds, you wish it to be at a low rate of interest.
What financial services are offered by a credit union?
trust accounts savings accounts automobile loans certificates of deposit
Why does a savings account make a better investment than a checking accounts?
Savings accounts earn interest.
What is the high interest savings accounts?
High interest savings accounts are savings accounts that banks give you that let you earn lots of interest with benefits. They usually are the toughest to get because you need to deposit a certain amount of money.
Do Savings accounts all earn the same amount of interest?
No they don't.
Does interest apply to dormant savings accts?
No. Banks will offer interest only on active bank accounts. Dormant accounts are inactive and do not earn any interest. Customers need to keep their accounts active if they wish to earn an interest through their accounts
Does the government tax savings accounts?
Any interest you earn will generally be taxable in the year that it is earned.
Why is a CD better then a savings account?
Because they earn a higher interest rate than savings accounts. The interest on CD's is atleast 2-3% higher than savings accounts. On the downside, the money in your CD is not as liquid as your savings account and your bank may charge you a penalty if you withdraw the money before maturity date.
Who is the best provider of High Interest Rate Savings Accounts?
WaMu is the best provider of High Interest Rate Savings Accounts.
Where can one find the highest savings interest rates?
One can find the highest savings interest rates by going to the Savings Accounts website. The website has a list of the top 10 Savings Accounts that have high interest rates.
What exactly are high interest savings accounts?
It's exactly like low interest savings accounts except this time it's high. This way you can save more money in a high interest savings accounts. You have got to be high not to get this account.
Which bank provides the best interest on bank accounts?
There are several banks that offer high interest savings accounts. ING Direct has a good reputation for offering a high interest rate with excellent customer service. Ally National Bank and American Express also provide high interest rates on their savings accounts.
How much more will 28000 earn in interest than 16000 if both are invested in savings accounts with APYs of 5.8 percent for a year?
696,00
What was the average savings interest rate 1993?
The average interest rate on savings accounts is 3.5 to 4%
