Savings Account Offers Highest Interest Rate - Now that interest rates are rising again, the traditional thought of "cash in the bank earns nothing" may no longer be true.
While the national average yield on a savings account is still a paltry 0.09%, according to Bankrate, many online banks like Marcus at Goldman Sachs, Ally, Barclays and Amex Personal Savings now offer savings accounts that yield 1% or higher, and in some cases, more than 1.4%. These online banks are FDIC insured and represent an opportunity to earn significantly more money.
Savings Account Offers Highest Interest Rate
Sure, these returns are still miniscule compared to returns on the stock market, but unlike investing in stocks, keeping some funds in cash comes with no additional risk. Thanks to FDIC insurance, savers can park up to $250,000 in deposits at any given bank and be sure their funds are safe.
Despite Some Paying 4 5%, Are High Yield Savings Accounts 'overrated'?
Yields on online bank savings accounts have soared since the Fed began raising rates from near zero in 2015. FDIC-insured savings accounts are a commodity, so there's no reason not to seek the highest returns under this government guarantee.
Why don't more consultants recognize this opportunity? During a long period of ultra-low interest rates, cash remained a largely forgotten asset class as investors looked elsewhere for yield. But now, as the Fed begins a series of rate hikes and online banks raise their rates to match, that story has changed. Yet most money remains trapped in traditional brick-and-mortar bank accounts, where it is both underearned and underinsured. How can advisors help their clients manage money more effectively?
First, it's important to understand that many clients hold much more cash than their advisors realize because investors often don't discuss their cash holdings with their financial planners—possibly because they don't consider it part of their investment portfolio. The average high-net-worth household holds more than 20% of its assets in cash, according to the Capgemini World Wealth Report. This is a much higher percentage than one would expect from just looking at their investment portfolio.
Remember, it's common for investors to maintain relationships with multiple financial advisors with the goal of keeping money in silos. Unfortunately, the less desirable outcome of this strategy is that their cash is often kept in inefficient places, such as low-yield brokerage accounts or bank accounts where cash earns almost no interest.
Traditional Savings Accounts Vs. High Yield Savings Accounts
Advisors often observe this pattern and find that, once they offer a cash-backed solution, clients discover that they have far greater cash holdings than they previously disclosed. This can act as a catalyst for a wider discussion on risk tolerance and asset allocation and enable the adviser to provide more holistic financial advice to the client.
Independent financial advisors help clients see the big picture—including their overall asset allocation and goals—and can also help clients earn more money. The bilateral benefits are clear: clients benefit from earning higher returns, while advisers' visibility into previously unknown cash can lead to organic growth in AUM, as part of this cash is redistributed to higher beta asset classes.
With the recent rise in yields, it pays for advisors to help their clients proactively manage their money to maximize returns. Whether the money is parked for the short or medium term—destined to go into a home, college fund, or philanthropic donation—or sitting on the sidelines waiting for buying opportunities in the stock market, the additional interest earned by Investing in money properly can be important, especially if it is compounded over time.
Fund Performance Savings Accounts Retirement Planning Money Market Funds Interest Rates High Net Worth Ultra High Net Worth FDICO Our research shows that the best high-yield savings account is at UFB Direct, which currently offers a 5.25% APY with no minimum deposit, fees or minimum balance needed to get that impressive rate. earn
High Yield Savings Account Vs. A Cd: What's The Difference?
But whatever you're looking for in a savings account, the Beveel editors have your back. We've compiled a list of some of the top high-yield savings accounts — on an overall basis and and in additional categories that prioritize different features you may find important.
Our picks for this month's best high-interest savings accounts are the complete package. Each account is offered by an FDIC-insured institution. The Federal Deposit Insurance Corporation insures up to $250,000 per depositor, per account, giving you an extra sense of security for your savings.
Before choosing an account, you should consider more than a higher interest rate. Compare the best high-yield savings accounts for features like ATM access, online and mobile banking, and more. Doing this will ensure that your bank account suits your needs.
Note: APYs in our list below are current as of August 28, 2023, but are subject to change.
Best Banks For Savings Accounts For September 2023
About: UFB Direct is an online only bank and division of the better known Axis Bank. Although they offer a limited selection of accounts and services, such as savings and money market accounts plus mortgages, they have mobile check deposits and banking services to help you grow your savings and monitor your progress.
UFB Direct customers can contact a customer service representative 24 hours a day, 365 days a year, or via secure messaging in their mobile banking app.
UFB Direct has the best yield against the best terms of any financial institution we've tested. With an outstanding APY of 5.25% and a bunch of no's in all the right places (no minimum deposit, balance or account fees), those looking for a top savings rate can stop their search here.
The UFB Direct savings account is best suited for those who are looking for returns above all else. This is an account you'll probably want to have in addition to the one at your primary bank because UFB doesn't offer checking. But your UFB Preferred Savings Account also comes with a free ATM card for quick cash and digital tools for remote banking.
Citibank Savings Account Interest Rates
About: Founded in 2009, Ally Bank is an online-only bank that offers checking, savings, mortgage, auto products and more. While the bank does not have physical branches, you will have free access to a network of more than 43,000 ATMs. You'll also be reimbursed up to $10 per state for any fees charged at an out-of-network ATM. Taking a bite out of ATM fees? Yes please.
If youare looking to get the most bang for your buck, Ally Bank's High Yield Savings Account is ready to give your savings a boost - especially if you have a significant balance in another savings account. The 4.40% APY may be a little below other banks, but a welcome bonus worth up to $500 can more than make up for the lower yield.
About: American Express Bank is part of the well-known credit card brand and offers customers a wide variety of financial products beyond lines of credit. You can choose from savings and check products, and also find competitive rates on certificates of deposit (CDs). What's more, they offer two key products from conservative retirement savers: CD IRAs and IRA High-Yield Savings Accounts—both with competitive APYs.
American Express National Bank customers have 24/7 access to customer service through options such as phone, online chat and email.
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When we think convenience, we think consolidation. That's why American Express National Bank made it to the top of our list for savers with convenience — especially those who already have an American Express card. The respectable 4.25% APY only sweetens an already sweet deal that includes a top-rated mobile banking experience along with easy access to your savings and spending under one roof.
With no minimum and no monthly fees, you can join or expand your relationship with American Express in no time, and earn money on your money in the process.
About: CIT Bank is a branch of Citizens Bank, but a branchless bank that keeps things strictly online. But their online-only status does not mean a lean set of products and services. From multiple checking, savings and CD options to business banking and mortgages, you'll find almost everything under the sun at CIT to set up your financial life.
You are never far from a CIT. Representatives can be reached by phone from Monday to Friday from 9:00 a.m. to 9:00 p.m. ET, Saturday 10:00 a.m. to 6:00 p.m. E.T. The bank also offers 24/7 automated phone support at 855-462-2652, as well as a secure email option within the mobile app.
Capital One Savings Account Interest Rates September 2023
If account security is your number one priority—even above APY—don't worry. With CIT Bank, you don't have to give up one to get the other. With safety features across the board and a 5.05% APY on their 1-year CD, you're set to get the best of both worlds. Their website and account access includes a trifecta of security requirements: multi-factor authentication, website encryption and fraud protection that covers your cards and accounts. To improve your security when using their mobile app, consider skipping public WiFi and using either a cellular signal or a secure WiFi connection.
About: SoFi Bank is an online bank with a wide variety of deposit, investment and loan services for its growing list of members. They started as a neobank with the charter of another bank to launch their banking services. But today, SoFi has its own banking charter and is not only FDIC insured. They are one of the few banks that offer
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