Take advantage of high yield savings accounts now that Interest rates for savings accounts are starting to climb.
This is the time to review where your money is parked and determine if you are getting the best return. If you want your money to be FDIC-insured and liquid, a high-yield savings account may be a good option for you.
Below are some common questions regarding these savings accounts
What is a High Yield Savings Account?
It is a savings account that pays a higher interest rate. It pays generally around 3%, but I’ve seen a few recently that hover around 4%. Of course, this will not make you rich, but it does give you a little more money each month and is much better than the 0.33% average rate we’ve been seeing on standard savings accounts.
The interest rates are comparable to CD rates. The difference is that you do not need to keep your money locked for a particular time with these savings accounts. You can withdraw at any time without penalty.
Keep in mind that the interest rate for this type of account is not fixed. This means it can go up or down over time.
Why put my money into a High Yield Savings Account?
These accounts are safe and generally, FDIC-insured so the risk is very low to none. They are optimal for your emergency fund savings or if you are saving for a large purchase and will need the funds very soon because they are accessible at any time.
Where can I find High Yield Savings Accounts?
The major banks may have these types of accounts but their rates are not super competitive. Online banks have great rates if you are comfortable using them. They can do this because they don’t have the costs required to maintain their branches.
Online banks are generally FDIC-approved and considered safe. Some may require a short waiting period to get your funds. Here are a few banks you might want to look into to get started. However, there are many of them.
Interest rates vary between 3%-5% at the time of this article.
Summary
So, if you have some savings set aside and you are looking to earn a little more interest, check out high-yield savings accounts. Again, you won’t get rich, but every little bit helps and why not take advantage of that extra little bit while you can?
Best of luck,
Jill