Why retirees are being short-changed by the big banks

As interest rates climb and homeowners squeal for mercy, there are two groups often forgotten who can now enjoy the fruits of rising rates: the wealth builders and the retirees.

This article appeared in the Sydney Morning Herald and The Age on Sunday the 2nd July 2023. If you missed it, you can read it here.

As interest rates climb and homeowners squeal for mercy, there are two groups often forgotten who can now enjoy the fruits of rising rates: the wealth builders and the retirees.

For eight long years, these people have felt sick every time interest rates dropped, wondering how to generate any income at all from their hard-earned savings without taking too much risk.

Now, rates are rising, but you will probably need to switch banks if you want to earn decent interest on your cash. The world of banking has fundamentally changed, and it’s important to understand why your money isn’t their priority anymore.

In the past, banks made money in many ways. They charged fees for holding funds in transaction accounts and paid you almost no interest. They loaned this money at much higher rates to people buying houses and made a killing.

Read the whole article here.