The year 2023 is over and 2024 is just beginning. Many changes are expected but the evolution of the Livret A rate is not one of them. Frozen until January 31, 2025, the yield on the French’s favorite savings account will therefore remain 3%. So how much interest can you expect for this new year?
Like more than 80% of French people, you hold a Livret A. Since the start of the year, the outstanding amount has climbed by almost 20 billion euros, thus exceeding the 400 billion euros mark. The public authorities have chosen to freeze the rate of this 3% savings book until January 31, 2025.
Despite this freeze, the real return on Livret A will soon become positive again. The actual yield corresponds the remuneration of Livret A corrected for inflation. An increase in consumer prices which reached peaks in 2023 and was therefore particularly bad for your savings. Negative since 2017, the real yield of Livret A should again be positive from April, according to INSEE forecasts. Quarterly inflation should fall back below 3%, 2.5%.
How much interest can you expect?
To calculate your interest amount in 2024, let’s assume that the balance will remain constant throughout the year and that there will be no additional payments or withdrawals. The rate is frozen at 3% throughout 2024, here is what your Livret A book can bring you:
- 45euros (compared to 43.75 euros in 2023) if the balance of your Livret A increases 1500 euros;
- 190.53 euros (compared to 185.23 euros in 2023) if the balance of your Livret A is average, i.e. 6351 euros at the end of 2023;
- 688.50 euros (compared to 669.38% euros in 2023) if the balance of your Livret A is at the level of the payment ceiling, 22950 euros. And more, of course, if you have exceeded this ceiling through interest capitalized over the years.
As a reminder, the rate for the A booklet is 2.92% on average in 2023. In fact, this booklet earned you 2% in January (1 month), then 3% from February to December (11 months).
Livret A: how much interest will you earn in 2023?
In reality, however, your balance will probably not remain constant all year round. Used as precautionary savings, the savings placed in your A savings account may help you avoid an overdraft, pay your taxes or even face a major unexpected expense. And these movements naturally complicate the calculation of capital gains due to the fortnight rule applied.
In fact, a payment made on the 2nd of the month is only taken into account from the 16th of the same month. And a deposit made on January 20 only pays you from February 1. The frequent back and forth therefore reduces the amount of interest received.
Livret A, PEL, life insurance, PER… What changes for your savings in 2024