The following article was written for the UK, but is applicable to the US. In order for your savings in a bank with their interest rate to actually keep your money at the same purchasing power or increase even slightly, the interest rates would have to be higher than anything currently on offer. That is why it makes more sense to have federal reserve notes converted to physical commodities like gold and silver.
The numbers would certainly vary a bit, but the situation is analogous to ours:
The numbers would certainly vary a bit, but the situation is analogous to ours:
The rising cost of living means higher rate taxpayers need a rate of 6.17 per cent to avoid losing money on their savings once inflation and tax is taken into account, while basic rate taxpayers need 4.625 per cent.
Just one account offers a higher rate for basic rate taxpayers. But the fixed rate bond from Coventry Building Society paying 4.75 per cent requires savers to lock their money away from five years and financial experts said this would not be suitable for many savers.
http://www.telegraph.co.uk/finance/personalfinance/8266502/Millions-of-savers-need-6pc-to-beat-inflation.html
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