Financial

How to Choose a High Yield Savings Account

Despite the economic challenges of rising inflation and the slipping stock market, a high yield savings account is the best place to store cash you might need in the next year. If you are ready to take the plunge and open your first high yield savings account, you are in luck! These days there are plenty of great options and interest rates are rising after two years of stagnation. 

What to look for in a high yield savings account

FDIC-Insured

FDIC insurance is the fail-safe that would reimburse you in the unlikely event that your bank goes under. This guarantee should help you sleep soundly at night with your money in the bank, rather than under your mattress.

Competitive APY

APY (annual percentage yield) is the term banks use for the interest rate they pay on your deposits. APYs are subject to change, but around 0.7% is competitive at the moment.

No fees and no minimums

These days, plenty of banks offer fee-free savings accounts so there is no reason to keep your money with a bank that makes you jump through hoops or charges a maintenance fee if your balance drops below a certain balance.

Allows multiple savings accounts

Having the option to open multiple savings accounts at the same bank is great for organizing your money for different goals.

User experience

No one wants to deal with a disorganized or finicky interface. Take the time to read reviews and browse videos of the user experience.

Ease of access

If you want to be able to access your savings quickly, seek a bank that also offers checking accounts. If you want to reduce the temptation to dip into your savings, a bank without checking accounts would actually be a feature. 

Our favorite high yield savings accounts

Ally Bank: Ally is a favorite among trainers at the Financial Gym for a lot of reasons. It is best for anyone who has multiple saving goals and for people who use the goals-based savings approach that we love at TFG. There is no minimum deposit or balance required, and they are known for having great customer service.

Marcus: Marcus is another FinGym favorite product best for anyone looking to grow their emergency fund in a separate bank from where they do their day-to-day banking.  It’s great for someone who is just starting their emergency fund as they don’t have any minimum deposit requirements or fees. It currently does not offer a checking account, although that is likely to change sometime this year.

Capital One 360: Capital One 360 is a good option for people who want to have all of their accounts in one bank with options for cash deposits. If you want the option for cash deposits, make sure that you live in a state with Capital One branches or ATMs. Capital One has no fees or minimums.

Chime: Chime’s savings account is part of a greater money management system that lets users save at a competitive interest rate, and save more by rounding up purchases over time. There are no fees or minimum balances. 

Our favorite digital banking alternative

Aspiration: Aspiration is the digital banking alternative to try if you’re looking to divest from fossil fuels. They promise a huge APY of up to 5% on savings for their Aspiration Plus members, and they also take steps to be environmentally friendly.

Ready to get started? Find these accounts and more on our B.F.F. approved high yield savings account page.

The content on this page is accurate as of the posting date; however, some of the offers mentioned may have changed.

Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.



Source
How to Choose a High Yield Savings Account is written by Kylie Lipinski, A Certified Financial Trainer for financialgym.com

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