When’s the last time you checked the interest rate on your savings account or money market account? What are you getting in return for stockpiling your cash?

Interest rates have been steadily climbing over the last few years, so much so that the dollar amount you can earn on your cash is climbing.

Most money markets, which are cash-like investments that usually pay a little more than bank deposits, are now yielding over 2%. That’s pretty good.

Instead of just throwing around percentages, let’s actually do the math on this.

Let’s say you have $50,000 socked away in your savings account today, and you’re pretty happy because you used to get $0 of interest on your cash, and now you’re getting a whopping .1%. Hey, it’s something right. Well, that something works out to $50/year.

But, if instead, you found somewhere to park your cash that’s paying 2%, like a money market, you’re not getting $50/year. You’re getting $1,000/year!

That’s $950 more dollars that you would have otherwise received, just by picking the higher interest money market instead.

One point of caution here, is that money markets are very safe investments, but they are not FDIC insured like the low-interest bearing savings account, so you’ll want to keep that in mind as your make a decision about where to invest your cash.

They are a great option for your cash though, and here at True North we have millions of dollars parked in money market accounts, so it’s worth looking into.

That’s it for today. Thanks for listening.

Tomorrow we’re going to talk about how you can start thinking about saving for retirement in baby steps.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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