How much your money worth?

I was surfing the savings account interest page for a few banks, this is what I’ve gotten. The interest rate has increased. But, does it really sufficient to hedge the inflation rate? Let's take a look at the interest first.

Savings account interest

DBS Saving Plus/ CDA and POSB Passbook (06 Aug 2008)

First $3000 - 0.2500%

Next $47,000 – 0.2750%

Next $50,000 – 0.3750%

Remaining balance above $100,000 – 0.4750%

OCBC Passbook savings / Basic banking account rate / statement savings

First $10,000 – 0.25%

Form $10,001 to $50,000 – 0.27%

From $50,001 to $250,000 – 0.38%

UOB Passbook savings

First $3000 - 0.2500%

Next $47,000 – 0.2750%

Next $50,000 – 0.3750%

Remaining balance above $100,000 – 0.4750%

Average increment of consumer price index is about 0.74% since 1998 – 2007 ( source: www.singstat.gov.sg). Assume that the interest rate for savings account constant at 0.25% for the past 10 years ( in fact, it was much lesser), the money that you park in a bank depreciate averagely at 0.69% per year.

Example:

In year 1998, you parked $100 in a bank, the value depreciate 0.69% yearly for 10 years and worth only $93.1 in today value. Isn’t it frightening?

In year 2008, the inflation raised to a record high, 6.6% in January 2008. In this case, your money park in the bank will further depreciate 6.35%, translate into value it only worth $87.18 now.

How you though of doing something? Or just leave it as it is?