Jim at Bargaineering had an insightful piece a few days ago: Your Best High Yield Savings Account? in which he pointed out that there’s not much difference between 1.5% and 2.05% when you think about it. We’ve had an account with HSBC for years (three, actually) and now that it’s fallen to a rate of 1.65% the incentive to invest more money in it has become much less.  You could also argue – and I would – that 1.65% far exceeds the rate of return on our 0.00% checking account, so there’s no need to sneer at the rate of return, which is very competitive with the market.

It is ironic that at this moment, when all news stories seem to be indicating that Americans are returning to a culture of frugality and saving, that we have so few options for safe, healthy returns on our investments. I am sure if HSBC offered 7% returns many people – like me – would be pulling all of our money out of our brokerage accounts and stashing them there.  They can’t offer rates like that, of course, but the truth is that people are anxious to save and someone will make the case to be safe enough and offer high enough returns to pull in those savers eventually.

Earn 1.65% APY* at www.hsbcdirect.com

photo credit: Unhindered by Talent