One-third of U.S. adults unaware of rate paid on their savings account
CALABASAS, Calif., Oct. 17 /PRNewswire/ -- A nationwide survey released
today shows that many Americans with both a checking and savings account
(71 percent) tend to group those primary accounts at one institution,
perhaps out of convenience, when they could keep them separate and
potentially earn a higher annual percentage yield on a savings account at a
different, savings-focused bank. Additionally, 67 percent of adults with
both accounts at the same financial institution said they have never
considered the concept of keeping these accounts at separate banks.
The survey was conducted by Harris Interactive(R) for Countrywide Bank,
FSB, the third largest federal savings bank in the U.S.(1) and a member of
Countrywide Financial Corp.'s (NYSE: CFC) family of companies.
According to the poll of adults who have a savings account, most
respondents (61 percent) have not established an automatic savings plan,
whereby a designated dollar amount is regularly deposited into a savings
account.
The survey also revealed that 32 percent of adults with a savings
account do not know the interest rate on their account, and a full 45
percent know they are earning less than five percent.
The findings indicate that there are areas where Americans can improve
their financial circumstances by using basic savings strategies --
separating their accounts, establishing an automatic savings plan and
always seeking the best rate possible, according to Countrywide Bank
Managing Director for Deposits and Investment Services Pierre P. Habis.
"Consumers are potentially leaving money on the table by not following
this simple formula," said Habis. "Serious savers consider their savings
account as 'one way' only, meaning that they make more deposits than
withdrawls, and they succeed at this by keeping their transactional banking
relationship at one bank and savings at another. We've found that if
consumers' checking and savings are under the same roof, it's too easy to
draw from that nest egg and that's when savings accounts stagnate," said
Habis.
Key findings from the survey include:
-- 67 percent of adults with both checking and savings accounts at the
same financial institution have never considered keeping their savings
and checking accounts in two separate institutions
-- 61 percent of adults with a savings account have not set up a savings
plan that automatically transfers a certain percentage of their
earnings to their savings account on a regular basis
-- 71 percent of adults with both a checking and savings account have
their primary savings and checking account with the same financial
institution
According to Habis, there are three key tips consumers should keep in
mind to optimize interest earnings for their savings:
Tip #1: "SEPARATE"
Separate your primary savings and checking accounts; house them at
different financial institutions. Consumers should consider keeping their
primary savings and checking accounts with different financial institutions
in order to get the best rates. Shop around to identify institutions that
offer the best possible terms. It is possible that the institution that
best meets a consumer's checking needs might not be the best suited for
providing market-leading savings rates. And by keeping accounts separate,
consumers are less likely to dip into the savings account to deal with
short term cash shortages.
Tip #2: "AUTOMATE"
Automatically transfer a set amount into savings. Remember to pay
yourself first and set up an automatic savings plan so a certain percentage
of your income, or a set dollar amount, is automatically transferred to
your savings account on a regular basis. Start out by trying to allocate a
small percentage, perhaps even $20 per week to start, towards a
high-yielding account.
Tip #3 "SEEK THE BEST RATE"
Research rates at different financial institutions. Take a close look
at the Annual Percentage Yield (APY) on savings accounts, money market
accounts or certificates of deposit. Avoid leaving money on the table by
ensuring that your account has market-leading savings rates. Websites such
as http://www.bankrate.com help consumers identify the highest rates
available in their market.
"As with any financial decision, consumers should carefully evaluate
their options and fully understand the advantages and disadvantages before
making a change," said Habis. "Consumers can maximize their returns if they
separate, automate and always seek the best rate."
Survey Methodology
This Bank Accounts survey was conducted by telephone within the United
States on behalf of Countrywide Bank between September 28 and October 1,
2007 among 1,018 U.S. adults ages 18+. Results were weighted for age, sex,
geographic region, and race where necessary to align them with their actual
proportions in the population.
All sample surveys and polls, whether or not they use probability
sampling, are subject to multiple sources of error which are most often not
possible to quantify or estimate, including sampling error, coverage error,
error associated with nonresponse, error associated with question wording
and response options, and post-survey weighting and adjustments.
Therefore, Harris Interactive avoids the words "margin of error" as
they are misleading. All that can be calculated are different possible
sampling errors with different probabilities for pure, unweighted, random
samples with 100% response rates. These are only theoretical because no
published polls come close to this ideal.
About Harris Interactive
Harris Interactive is the 13th largest and one of the fastest-growing
market research firms in the world. The company provides innovative
research, insights and strategic advice to help its clients make more
confident decisions which lead to measurable and enduring improvements in
performance. Harris Interactive is widely known for The Harris Poll, one of
the longest running, independent opinion polls and for pioneering online
market research methods. The company has built what it believes to be the
world's largest panel of survey respondents, the Harris Poll Online. Harris
Interactive serves clients worldwide through its North American, European
and Asian offices, and through a global network of independent market
research firms. More information about Harris Interactive may be obtained
at http://www.harrisinteractive.com.
About Countrywide Bank
Countrywide Bank, FSB, is a member of the Countrywide Financial
Corporation (NYSE: CFC) family of companies. Countrywide Bank offers
consumers highly competitive rates on certificates of deposit and money
market accounts and, through its family of companies, also offers
investment* and insurance products. Customers can review banking products
and services, check rates on deposits, and apply for new accounts by phone,
online, or at one of 136 financial centers located throughout the country.
In addition, the company offers the same superior rates and unsurpassed
personalized service to its business customers through its Premier Business
Banking and Commercial Banking Divisions. For more information about
Countrywide Bank, visit http://www.countrywidebank.com. Member FDIC. Equal
Housing Lender.
*Countrywide Investment Services and Countrywide Insurance Services
Products
Not FDIC Insured Not Guaranteed By Any Bank Not A Deposit
May Lose Value Not Insured By Any Federal
Government Agency
(1) Ranking is based on Second Quarter 2007 as reported by the FDIC.
SOURCE Countrywide Bank
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Related links:
http://www.countrywidebank.com
http://www.harrisinteractive.com
CONTACT:
Media Hotline, 1-800-796-8448,
pressroom@countrywide.com
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