I sat down to do my taxes over the weekend and I realized I was missing a 1099 from a bank where I have an interest savings account. I called up the bank and after some rooting around, the phone rep realized I didn’t get a form because the bank doesn’t mail one out if interest earned over the course of the year is less than $10. Turns out, I’ve been earning a whopping 0.02% on my money. That came to $1.41 for all of 2009.
I have been very patient living in a world with preposterously low interest rates. But now I am done.
As a person looking to save, and not to borrow, the past year has been brutal. I don’t need a 5% mortgage. I don’t want to finance a new car purchase. What I want is to be paid decently when I lend financial institutions my money.
I do, of course, understand that low interest rates have indirectly benefited me by keeping the country out of a deeper recession. I also understand that complaining about low interest rates on savings products makes me sound like a senior citizen.
But maybe that’s the point. Now that the Fed and other central banks around the world are getting ready to start raising rates, we’re beginning to hear about all the people who are going to suffer as a result. The poor home buyers. The poor stock-market investors.
Let’s just keep in mind that some people will also benefit. I think of my grandmother and how little money she’s been receiving from her portfolio of CDs. Interest rates can only go up from here. And I know I’m not the only one looking forward to it.