I’m Checking My Savings Account Weekly These Days — but Maybe Not for the Reason You Think

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It’s not because I’m worried I’m not saving enough. 

When you’re working toward different savings goals, it’s natural to want to know how well you’re doing. And so you may be inclined to check your savings account balance every so often to see what it looks like.

On my end, I have an automatic transfer set up from my checking account to my savings, so money is supposed to move from one account to the other before I get a chance to spend it. Because of this, it’s common for my savings account balance to be higher from one month to the next.

On the other hand, it’s pretty rare for my savings account balance to increase from one week to the next. I typically move money over (automatically) on a monthly basis, not a weekly one. And while my savings account balance tends to increase after I’m credited for interest payments, those only tend to happen on a monthly basis, too.

In spite of all of this, lately, I’ve been peeking at my savings account every week. But you may be surprised at the reason.

It’s about interest, not progress

I’m fairly confident that I’m doing my part to save nicely, namely because I know I part with a pretty large chunk of my income off the bat every month. And I also tend to have a solid pulse on what my savings account balance looks like.

The reason I’ve been checking my savings account every week has little to do with my actual balance. Rather, it’s a matter of the interest rate I’m earning on my money.

Prior to 2022, I was earning such a negligible interest rate on my savings that it almost wasn’t even worth shopping around for a better rate. But in 2022, the Federal Reserve raised interest rates seven times. And in early February, it announced another rate hike (albeit a small one).

These interest rate hikes have indirectly driven up the cost of consumer borrowing, so these days, it’s more expensive to take out an auto loan or personal loan. It’s also getting more expensive to carry a credit card balance.

But those rate hikes have also resulted in higher interest rates on savings accounts and CD accounts alike. And so the reason I keep checking my savings account is to make sure the rate I’m receiving is competitive. If I find that it isn’t, I’ll be motivated to move my savings over to another bank. And it will most likely be an online bank, since those tend to offer the most attractive interest rates due to having less overhead than physical banks.

It pays to keep tabs on your saving account’s interest rate

You may not feel compelled to check your savings account’s interest rate and compare it to others every week like I do. But it does pay to do that comparison once a month and make sure you aren’t selling yourself short. Earning interest is basically akin to getting free cash — and so why not get a little more of it if that option exists?

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