Shopping around for high-yield savings accounts, CDs could earn consumers more money

SAN FRANCISCO (KGO) -- How much does your bank pay in interest on your savings account? Most I speak with have no idea.

I asked Garrett Sandow out of Redding if he knew the interest rate his bank was paying on his savings account.

"No, I wouldn't know the interest rate is on that," he said. "I would on my credit card, not on the bank account."

Here I am speaking with San Francisco's Dena Shapiro.

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MICHAEL FINNEY: "Do you have a bank account?"

DENA SHAPIRO: "I do have a bank account."

FINNEY: "Do you know what the interest rate is?"

She laughed and said, "Not today."

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The FDIC currently covers deposit accounts up to $250,000 -- but that could soon change.

Now let me introduce you to a guy who does know his bank's interest rate.

Ken Tumin keeps close track of interest rates paid on savings, CDs and similar accounts all over the country. He is the founder of DepositAccounts.com, now a part of Lending Tree.

FINNEY: "CDs are paying some serious cash now, aren't they?"

KEN TUMIN: "Yes, they are. We haven't seen rates like this for more than a decade."

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How high are rates?

"Well, if you shop around, you can easily get over 5%, on a short-term CD," Tumin said.

But you do have to shop around. Interest rates are all over the place, from around 5% down to 0.01%.

Let's talk about what that means.

If you have $1,000, and get an interest rate of 5% for a year, you will be paid $50.

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If you are paid 0.01%, you will receive a dime.

Top deposit account rates are seen as a pretty good deal for safe money investors and, oddly enough, this is one of those few times where it appears there is no hurry to make a quick decision.

"I don't foresee rates going quickly this year," Tumin said. "So, you know, you could do well with just with a savings account, the high-yield savings account right now. You can do a little better with CDs. A one-year CD over 5% is easily obtainable right now."

And as long as you are looking, Tumin says, look online: "Online banks can usually have higher deposit rates because they don't have the overhead of a branch network."

Take a look at more stories and videos by Michael Finney and 7 On Your Side. 7OYS's consumer hotline is a free consumer mediation service for those in the San Francisco Bay Area. We assist individuals with consumer-related issues; we cannot assist on cases between businesses, or cases involving family law, criminal matters, landlord/tenant disputes, labor issues, or medical issues. Please review our FAQ here. As a part of our process in assisting you, it is necessary that we contact the company / agency you are writing about. If you do not wish us to contact them, please let us know right away, as it will affect our ability to work on your case. Due to the high volume of emails we receive, please allow 3-5 business days for a response.

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