With a potential rate hike on the horizon and “uninspiring” domestic data and global turmoil mucking up the mix, personal finance cites WalletHub and CardHub today released a pair of studies aiming to help consumers figure out where to best park their cash.
Notably, WalletHub’s 2016 Banking Landscape Report found that personal, online-only savings accounts offered the highest interest rates for consumers and named personal, online-only checking accounts a runner-up, yielding 0.64 percent and 0.34 percent respectively. Moreover, WalletHub said that checking branch accounts generally yielded about 151 percent higher interest rates than savings accounts and concluded that “banks seem to be discouraging long-term saving.”
WalletHub broke down some of its findings geographically, too. For instance, the personal finance site concluded that consumers in the Northeast and West reaped significantly lower returns on checking and savings accounts than consumers elsewhere in the country, earning 73 percent less on checking accounts and 45 percent less on savings accounts.
The site also advised consumers looking for the lowest checking accounts fees to focus on offerings at credit unions, which WalletHub said averaged 32 percent lower than the next best option, online checking accounts. It also found that free deposit-account features were becoming more popular, with almost 24 percent fewer accounts charging out-of-network ATM fees and more than 20 percent more accounts reimbursing ATM-owner surcharges, compared with the second quarter last year. WalletHub also said that online bill pay fees and paper statement fees fell 15.72 percent and 8.46 percent, respectively.
Meanwhile, CardHub’s recent Credit Card Landscape Report found that relative to last quarter, interest rates are rising in the above-average-credit segments of the market, while rates were trending downward at the other end of the credit worthiness spectrum. It said the “fair credit” segment saw the biggest drop, 3.86 percent, from the beginning of 2016. CardHub also found that on average, credit card interest rates increased 24 basis points since year-end 2015, matching the Fed’s rate hike last year.
CardHub also found that interest-free introductory terms were 18 percent longer for balance transfers than for new purchases, followed by a regular APR that averaged about three percentage points lower. The site said this reinforces its hypothesis that issuers are targeting consumers already “mired in debt” more than they are incentivizing people to take on new debt.