Most middle-income Americans still earning less than 3% on savings

Despite inflation concerns, most middle-income Americans still aren’t leveraging higher interest rates for savings.

That’s according to a new Santander survey of roughly 2,200 middle-earning U.S. adults, conducted in early September.

Some 64% of middle-income Americans are earning less than 3% on their primary savings account, the findings show. By comparison, the top 1% average of high-yield savings accounts offer close to 5%, as of Oct. 30, according to DepositAccounts.

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The bank was surprised that 22% of consumers still don’t know how much they are earning on savings, said Tim Wennes, CEO of Santander U.S.

But a lack of awareness isn’t the main reason why Americans aren’t taking advantage of higher rates, according to the survey. The top reason for not moving funds — applying to some 37% of respondents — was because they either don’t have any savings or don’t have enough to “make it worthwhile.”

However, some 36% of those surveyed have at least $10,000 in savings or more, Wennes pointed out.

“I would argue it is worth their while” to explore higher-yielding options, he said. “Become aware, look at your statements and then take action.”

The survey also uncovered a lack of knowledge about the definition of savings products like certificates of deposit, high-yield savings accounts or money market accounts.

As Americans brace for another interest rate update from the Federal Reserve this week, experts say savers may consider opening a CD to secure higher rates for a set period of time. While the central bank isn’t expected to raise rates, future policy shifts are still unclear.