51M. As a child I had a children’s saving account with compound interest. My $100 went up to just below $200 in around 4 – 5 years. That seems like peanuts, but to a kid that was a lot.As a young adult, in the mid 1990s, I remember my older colleagues were talking seriously about CD interest rates to put away for up to five years, at 6%.
Now, in 2024, with the major banks, a one-year CD from Bank of America is 0.03%. Maximum rates for 5 years is 2.5% at Chase, no matter how much money you put away. Savings accounts compound interest rates are 0.01%, max, IF you maintain at least $10,000 in the account.Yet interest rates for a housing loan are at 7% and putting housing purchases out of reach. How can the banks do this?
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In: Economics
You were a child at a time when interest rates were quite high overall.
When you were 10 years old the interest rates were around 14%. Great for young kids who didn’t have any debt but horrible for adults who did.
Now interest rates are lower now but you can get a CD for over 5% though even today.
[https://fortune.com/recommends/banking/the-best-cd-rates/](https://fortune.com/recommends/banking/the-best-cd-rates/)
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