Money Market Account & Savings Accounts Rates: June 22, 2009

Money market account and savings account rates decreased fractionally this past week. The average savings account rate hasn’t changed much this year, after the dramatic decline from the higher savings account rates we had last year when one could find a savings rate between three percent and four percent.

The decline in rates for both savings accounts and money market account rates increased after the Troubled Asset Relief Program (TARP) gave banks another way to fund their reserves instead of using deposit accounts. Banks dramatically lowered their rates because it was cheaper for them to borrow money from the government then it was to pay depositors. Cheaper but at a price, many banks are now regretting borrowing funds from TARP because of the government oversight and scrutiny on their spending and executive compensation.

Savings Account and Money Market Account Rates

The average money market account and savings account rate for account balances of $2,500 decreased to 0.429 percent this week, down from last week’s average rate of 0.432 percent. AIG Bank is currently offering a savings interest rate of 1.76 percent on an account balance of $2,500.

Average savings account and money market account rates on account balances of $10,000 is at 0.527 percent this week, down from last week’s average rate of 0.532 percent. HSBC Direct is currently offering a high savings rate on all account balances, their rate is currently at 1.55 percent.

The average rate for money market account and savings account rates for account balances of $25,000 is at 0.609 percent this week, down from last week’s average savings rate of 0.615 percent.

The average money market account rate and savings account rate for account balances of $50,000 is 0.678 percent this week, down from last week’s average savings account rate of 0.684 percent. AIG Bank is offering a high interest savings account rate of 1.96 percent for account balances of $50,000 this week.