Understand Your Savings: Why Interest Rates Matter

*Some parts of this article were updated on March 17th, 2020.

If you asked me how much I’m earning in interest on my savings account, I couldn’t tell you. What I do know, is that the numbers on my statement next to the word “interest” are in cents. Not dollars. I had a hunch that I wasn’t the only one totally baffled by those evasive interest rates on traditional savings accounts, so we ran a poll and discovered that 46.5% of respondents also have no idea what their interest rate is.

Needless to say, this is a problem. Not only is there a lack of understanding around how much you’re earning on your cash with traditional banks, but there can also be all sorts of additional fees layered on top — account fees, management fees, overdraft fees, to name a few. Your bank is definitely earning money on your cash, so why shouldn’t you? This got us thinking: there’s got to be a better way to save.

Enter Personal Capital Cash¹

At Personal Capital, we’ve seen firsthand how unrealized interest can impact people’s net worth: As of June 6, 2019, our 2 million dashboard users have over $41 billion in cash sitting in savings, checking, or money market accounts. If they’re earning the national rate on those accounts², that means they’re losing out on hundreds of millions annually that they could be earning in interest by keeping their cash in a high-yield account.

We couldn’t just sit by and let you lose out on all that interest, so we recently introduced Personal Capital Cash, offering a new cash account. And it’s not just for our current users or wealth management clients, it’s for everyone. You deserve more from your money.

What’s Different About Personal Capital Cash?

The way we save is broken. Personal Capital Cash is very different than other accounts you’re used to — with no account minimums, no fees, and flexible deposits and transfers, it does more than just stash your cash.

Here’s what that actually means: Personal Capital Cash offers more than just a higher rate. It’s a way to save that gives you transparency, ease of use, security, and flexibility — without all of the “gotchas” you’re used to.

Your money is hard earned, and Personal Capital Cash can help you make every penny count. Don’t just save your cash — you should also be earning on it.

How Much Should I Be Saving?

No matter where you put your money, saving is hard, and saving confidently is even harder. We all have saving goals — both shorter-term and longer-term, and there are no shortage of places to put your savings — retirement accounts, debt paydown, college savings, bank accounts, the list goes on.

So to resolve the question of how much you are currently saving vs. how much you should be saving and where, we’re also unveiling a new feature of the Personal Capital Dashboard: The Savings Planner.

Savings Planner is the perfect sidekick to Personal Capital Cash. It’s here to help you understand the role of saving in the context of your holistic financial picture. This includes not only how much you should be saving, but also where you should be saving and how to balance different savings objectives. So for example, if you have too much allocated to your emergency fund, savings planner will recommend where to move your extra cash to best meet your savings goals.

Earn More Now

Personal Capital Cash is a safe, flexible, and high-yield place to park your savings, and Savings Planner helps you understand how much you should be saving and where. It’s a powerful combination, and we’re excited to share it with you.

Sign up in just a few easy steps to start saving smarter with Personal Capital Cash and Savings Planner.