The following is reprinted from our Motley Fool CAPS blogs. Blog entries often discuss one or two issues within a larger argument, and so single blog entries can be out of context when presented here. In addition, the interest rates the blog cites change frequently and haven't been verified. The material should be read in that light.

investmentguru30's CAPS Blog
Jan. 14, 2009

What's the worst deal for your money? These days a savings account at a commercial bank is one of the poorest long term investments for your money. Commercial saving accounts yield some of the lowest rates of return for your money. Check out the rates from some of the country's biggest banks.

A Bank of America  (NYSE:BAC) regular savings account pays a paltry 0.20% interest rate for your savings. Most savings accounts allow you six free withdrawals per month before being charged a fee. Bank of America only allows 3 withdrawals per month and charges $3 per withdrawal. This is one of the biggest rip offs going.

Think you could do better with a JPMorgan Chase (NYSE:JPM) account? A Chase Bank savings account pays 0.01% . This is the worst return of any savings account that I have found. Surely Wells Fargo  (NYSE:WFC) has to pay more. A Wells Fargo goal savings pays the same crummy 0.01%. If you invested $1000 in a Chase or Wells savings account you would make 10 cents the whole year using simple interest.

A US Bank  (NYSE:USB) standard savings Account pays 0.10%. What about Wachovia? Just a little better. Open a Wachovia premium savings account and get 0.15% interest.

A commercial bank's savings account is a great way to build wealth for the bank. The customer gets paid a terrible interest rate while banks wait and hope that your account drops below the minimum balance so that they can charge you a 3 or 4 dollar monthly fee. Let's say you put $1000 in a Bank of America savings account and kept it there for one year, you would earn $2.00 on your money. If you let your account drop below $300 for one day, Bank of America will charge you $3.00. It takes all year to earn $2.00 but just one day to lose $3.00.

So, where should you put your savings? The best place for your savings is at your local credit union or a FDIC insured online savings account. Many credit unions offer rates of at least 1%. For every $1 that you earn in interest at US Bank you could earn 10 times that at a credit union and without the costly fees. Online savings accounts are offering between 2% and 3.5% on savings accounts. You could easily earn 25 times the rate that a large bank is paying.

The days are gone when commercial banks existed to make money for the customer. Banks are in business to maximize their profits. They generate this money by charging customers fees on checking and saving accounts. Remember banks are not stupid. They hire MBA's to figure out the best way to maximize profitability. If your bank is paying you 0.20% interest they know that it will take 360 years before your money doubles. Financial institutions bank on the fact that customers will not be around to see their account balances double. If you can wait that long for your money to grow than a commercial savings account is a good investment.

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investmentguru30 is not an employee of The Motley Fool, and his opinion does not necessarily reflect that of the Fool. US Bancorp and JPMorgan Chase are Motley Fool Income Investor recommendations and Bank of America is a former pick of that newsletter. Try any of our Foolish newsletters today, free for 30 days. The Fool has a disclosure policy.