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Withinflation accelerating to 4.2%year over year, leaving your money in a basic savings account can cost you money: The average interest rate on a savings account is just 0.38%.
That means the interest you earn on your savings account may not keep pace with inflation.
To maximize your return, stashing your money in a Series I savings bond (more commonly known as an I bond) or a high-yield savings account (HYSA) can be a smart alternative.
Both of these products offer higher returns thantraditional savings accounts, but there are some key differences to be aware of before deciding where to put your money.
Read more:Should you buy Series I bonds as inflation heats up again? Series I bonds are available through theU.S.
Department of the Treasury, backed by the full faith and credit of the U.S.
The appeal of I bonds is in their two-pronged approach to interest: I bonds earn both a fixed rate of interest and a variable rate.
The fixed rate stays the same for the life of the bond.
The variable rate is tied to inflation and changes twice a year to coincide with changes to theConsumer Price Indexfor all Urban Consumers (CPI-U) — a benchmark that economists use to calculate the change in prices that consumers price for common goods and services.
What does that mean for you? You earn a guaranteed rate of interest with the fixed-rate portion of the I bond, but you'll also earn the variable rate.
Because I bonds can change along with market conditions, they can be a useful hedge against inflation.
| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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