bank rates

Americans Are Still Fleeing CDs. Are You?

Poll QuestionNumbers don’t lie.

While safe and dependable, certificates of deposit are still losing favor with savers.

New Federal Reserve data shows that savers pulled nearly $100 million out of CDs in 2013, continuing the trend that began in 2008 when CD rates started plunging.

What the Fed considers “small denomination time deposits” – deposits with balances of less than $100,000 – began 2013 at $626.4 billion. By June, they’d dropped to $592.3 billion; at the end of December, they totaled $535.9 billion.

That’s a 14% decrease in just a year. Not insignificant.

Especially when you consider that before the recession, deposits hit the $1.4 trillion range.

We know our readers are still saving, and we know they’re anxious to invest in CDs again.

You told us as much in a recent poll, when we asked if 3% was a good enough CD rate to buy.

Many readers took that poll, with the majority responding that you’ll buy CDs again when rates hit 4% and 5%.

Our advice: Grab a seat and put your feet up.

That may be a while.

Even though Pentagon Federal Credit Union continues to pay 3.04% APY, CD rates at banks top out at 2.16% APY on our CD Rates Leaderboard.

So, if you’re still sitting on the sidelines (or you’ve jumped back into CDs), we’d like to know where you’re parking your cash.

We asked the same question in October 2012, back when the best nationally available CD paid more than a full percentage point less.

The result: a tie for the most popular answer. Savings accounts were just as popular as certificates of deposit among those who took our poll.

n

n

n

n

Where are you putting your money?
  • Add an Answer
View Results

Don't miss out on the next bank deal. Get the newest deals delivered straight to your inbox!

Comments (0)
1 Star2 Stars3 Stars4 Stars5 Stars (3 votes, average: 5.00 out of 5)
Loading...
No Existing Comments

Comments are closed.