Sitting Out The Bear Market

There’s a lot of advice circulating about what to do with your finances during the bear market. As we wait for the market to bottom out (hopefully soon), we’ve been contributing more to our savings account than the market.

A few weeks ago I charted our income vs expenses over the past 12 months. I went through all our savings account statements and was shocked at how quickly our interest went down over the months despite increasing our balance. In fact, we were earning mere 0.15% on our money. That’s better than losing it on the market, but it was time to change.

A friend told us about eTrade’s saving account services. I already use eTrade and have been pleased with their service, so I decided to check it out. The benefits are clear.

Let’s do some simple math. Moving $1000 to an eTrade savings account would make me $33.00 a year in interest compared to $1.50 from my current bank. In addition, I would save $83.40 a year in my bill pay service. Top it off with saving a few $2 ATM fees, and that’s $120.90 more in my pocket from just moving $1000 over to eTrade.

There’s plenty of other banks offering better interests rates. I picked a service with which I’m familiar. I also based my decision on the usability of their site (also why I chose my current bank). Hopefully the bull market will kick in this fall like many analyst are predicting. Until then we’ll park our cash and read up on some good investment books.