## How does savings account interest work?

Savings accounts are the simplest place to park your money. They are FDIC insured, meaning there is practically zero risk, and you are guaranteed a rate of return.

In the past decade or so, savings interest rates have been abysmally low. In short, these low returns are driven by the overall low interest rate environment, because banks can borrow money cheaply and therefore do not need to incentivize consumers to add to their savings accounts.

Ideally any financial instrument that you use to park your money will keep pace with inflation. Otherwise the real value of your dollars will decrease. As with any investment, it's necessary to adjust your savings account interest for inflation to fully understand the cost of keeping your money with in a savings account. Although a savings account guarantees a rate of return, this return is not inflation-adjusted (in other words, it is "nominal").

This page combines Consumer Price Index (CPI) data from the Bureau of Labor Statistics with average savings account interest rates reported by the Federal Reserve. By taking the difference between savings interest rates and the inflation rate, we calculate the "real" (inflation-adjusted) rate of return for savings accounts.

The calculation is simple:

According to recent CPI and Federal Reserve data, the current inflation-adjusted rate of return for a 12-month Certificate of Deposit is -4.12%.

## Savings Account Real Rates Chart, 2009-2021

Values went from 1.65 in 2009 to -4.12 in 2021.

This graph displays inflation-adjusted returns for the first of each month since 2009.

## Savings Account Real Rates Table, 2009-2021 (Yearly)

This table displays Inflation-Adjusted Savings Account Rates on January 1st of each year.

Year Savings Account Real Rates Change Year-over-year (%)
2021 -1.35 1.05 -43.68
2020 -2.40 -0.94 64.01
2019 -1.46 0.55 -27.32
2018 -2.01 0.43 -17.60
2017 -2.44 -1.13 85.82
2016 -1.31 -1.46 -979.21
2015 0.15 1.67 -109.83
2014 -1.52 0 0.27
2013 -1.51 1.30 -46.19
2012 -2.82 -1.35 92.58
2011 -1.46 0.96 -39.74
2010 -2.43 -4.07 -247.30
2009 1.65 0 0

## Savings Account Real Rates Table, 2009-2021 (Monthly)

This table shows 12-month trailing Inflation-Adjusted Savings Account Rates for the first of each month.

Year Month Savings Account Real Rates Change Month-over-month (%)
2021 3 -4.12 -1.55 60.31
2021 2 -2.57 -0.94 58.02
2021 1 -1.63 -0.28 20.48
2021 0 -1.35 -0.04 2.88
2020 11 -1.31 -0.19 16.67
2020 10 -1.12 0.01 -0.67
2020 9 -1.13 0.18 -13.67
2020 8 -1.31 -0.06 4.94
2020 7 -1.25 -0.32 34.94
2020 6 -0.93 -0.35 60.85
2020 5 -0.58 -0.53 1,101.29
2020 4 -0.05 0.19 -79.96
2020 3 -0.24 1.21 -83.50
2020 2 -1.45 0.80 -35.44
2020 1 -2.24 0.15 -6.33
2020 0 -2.40 -0.20 9.18
2019 11 -2.20 -0.23 11.92
2019 10 -1.96 -0.29 17.16
2019 9 -1.67 -0.05 3.25
2019 8 -1.62 0.03 -1.73
2019 7 -1.65 0.06 -3.60
2019 6 -1.71 -0.16 10.53
2019 5 -1.55 0.14 -8.39
2019 4 -1.69 0.21 -10.87
2019 3 -1.90 -0.12 6.99
2019 2 -1.77 -0.34 23.94
2019 1 -1.43 0.03 -2.13
2019 0 -1.46 0.36 -19.72
2018 11 -1.82 0.28 -13.19
2018 10 -2.10 0.35 -14.16
2018 9 -2.44 -0.25 11.17
2018 8 -2.20 0.42 -16.12
2018 7 -2.62 0.25 -8.72
2018 6 -2.87 -0.07 2.43
2018 5 -2.80 -0.07 2.58
2018 4 -2.73 -0.34 14.14
2018 3 -2.39 -0.10 4.50
2018 2 -2.29 -0.14 6.41
2018 1 -2.15 -0.14 7.03
2018 0 -2.01 0.04 -1.88
2017 11 -2.05 0.09 -4.36
2017 10 -2.14 -0.16 8.15
2017 9 -1.98 0.19 -8.83
2017 8 -2.17 -0.29 15.65
2017 7 -1.88 -0.21 12.65
2017 6 -1.67 -0.09 6.01
2017 5 -1.57 0.24 -13.30
2017 4 -1.81 0.32 -15.18
2017 3 -2.14 0.18 -7.80
2017 2 -2.32 0.36 -13.34
2017 1 -2.68 -0.24 9.75
2017 0 -2.44 -0.43 21.12
2016 11 -2.01 -0.38 23.40
2016 10 -1.63 -0.06 3.59
2016 9 -1.58 -0.17 12.27
2016 8 -1.40 -0.40 39.98
2016 7 -1 -0.24 30.73
2016 6 -0.77 0.17 -18.16
2016 5 -0.94 0.02 -2.29
2016 4 -0.96 0.11 -9.93
2016 3 -1.07 -0.27 34.39
2016 2 -0.79 0.17 -17.25
2016 1 -0.96 0.36 -27.06
2016 0 -1.31 -0.64 96.12
2015 11 -0.67 -0.23 51.54
2015 10 -0.44 -0.33 299.55
2015 9 -0.11 -0.21 -215.03
2015 8 0.10 0.23 -171.17
2015 7 -0.14 -0.03 23.28
2015 6 -0.11 -0.05 71.82
2015 5 -0.06 -0.16 -163.81
2015 4 0.10 -0.16 -61.49
2015 3 0.26 0.13 94.20
2015 2 0.13 0.05 56.98
2015 1 0.09 -0.06 -43
2015 0 0.15 0.85 -121.44
2014 11 -0.70 0.57 -44.83
2014 10 -1.26 0.34 -21.32
2014 9 -1.60 -0.01 0.40
2014 8 -1.60 0.04 -2.54
2014 7 -1.64 0.29 -15.15
2014 6 -1.93 0.08 -3.98
2014 5 -2.01 0.05 -2.65
2014 4 -2.07 -0.17 9.21
2014 3 -1.89 -0.44 30.34
2014 2 -1.45 -0.39 36.18
2014 1 -1.07 0.45 -29.80
2014 0 -1.52 -0.08 5.36
2013 11 -1.44 -0.26 22.48
2013 10 -1.18 -0.27 30.26
2013 9 -0.90 0.22 -19.67
2013 8 -1.12 0.33 -22.86
2013 7 -1.46 0.44 -23.27
2013 6 -1.90 -0.22 12.84
2013 5 -1.68 -0.39 30.38
2013 4 -1.29 -0.30 30.10
2013 3 -0.99 0.41 -29.26
2013 2 -1.40 0.50 -26.42
2013 1 -1.91 -0.39 25.95
2013 0 -1.51 0.15 -8.80
2012 11 -1.66 0.02 -1.37
2012 10 -1.68 0.40 -19.12
2012 9 -2.08 -0.18 9.52
2012 8 -1.90 -0.30 18.65
2012 7 -1.60 -0.29 22.46
2012 6 -1.31 0.26 -16.34
2012 5 -1.56 0.04 -2.51
2012 4 -1.60 0.60 -27.17
2012 3 -2.20 0.35 -13.67
2012 2 -2.55 0.21 -7.59
2012 1 -2.76 0.05 -1.92
2012 0 -2.82 0.03 -0.96
2011 11 -2.84 0.43 -13.19
2011 10 -3.27 0.12 -3.56
2011 9 -3.40 0.33 -8.94
2011 8 -3.73 -0.10 2.68
2011 7 -3.63 -0.15 4.38
2011 6 -3.48 -0.07 2.05
2011 5 -3.41 0.01 -0.29
2011 4 -3.42 -0.42 13.82
2011 3 -3 -0.48 19.12
2011 2 -2.52 -0.58 30.14
2011 1 -1.94 -0.48 32.54
2011 0 -1.46 -0.14 10.27
2010 11 -1.33 -0.36 37.64
2010 10 -0.96 0.03 -2.93
2010 9 -0.99 -0.04 4.04
2010 8 -0.95 -0.01 0.59
2010 7 -0.95 0.09 -8.41
2010 6 -1.04 -0.18 21.31
2010 5 -0.85 0.97 -53.14
2010 4 -1.82 0.21 -10.14
2010 3 -2.03 0.08 -3.68
2010 2 -2.10 -0.17 8.83
2010 1 -1.93 0.49 -20.30
2010 0 -2.43 0.10 -3.79
2009 11 -2.52 -0.89 54.84
2009 10 -1.63 -2.02 -514.48
2009 9 0.39 -1.10 -73.74
2009 8 1.50 -0.21 -12.21
2009 7 1.70 -0.61 -26.45
2009 6 2.32 0.67 40.71
2009 5 1.65 0 0