Interest rates on savings accounts have been nearly cut in half amid the economic fallout from the coronavirus pandemic, but it’s still smart to put your money into one when rates are low.

Opening a high-yield savings account, even during a recession, helps you save up for emergencies and future goals. If you have the cash to set aside now, there’s no sense in waiting for brighter days.

Thankfully, it’s never been easier to open a savings account, due to the power of the internet. Just a simple Google search will probably deliver hundreds of options from both online and brick-and-mortar banks. And more often than not, these banks offer limited-time incentives and/or cash bonuses if you open a checking account or savings account with them.

But with so many options available, you should take your time to find the best high-yield savings account for your money. To find the best fit, consider these four important factors.

1. Online vs. traditional savings accounts

Before you visit your traditional bank to open a high-yield savings account, take a look at your options online.

Online banks typically offer far higher interest rates on savings accounts than brick-and-mortar banks. They have less overhead to pay for since they don’t have to run physical branches. Because of the fewer operating costs, online banks can pass on those savings to their customers in the form of higher interest rates.

While it may be an adjustment to do all of your banking virtually, know that money in an online bank is secure as long as the bank has FDIC insurance (meaning it’s backed by the Federal Deposit Insurance Corporation). You will find that most high-yield savings accounts are FDIC-insured up to $250,000.

Consider this one: Marcus by Goldman Sachs High Yield Online Savings

Marcus by Goldman Sachs High Yield Online Savings

Marcus by Goldman Sachs High Yield Online Savings

Information about the Marcus by Goldman Sachs High Yield Online Savings has been collected independently by CNBC and has not been reviewed or provided by the bank prior to publication. Goldman Sachs Bank USA is a Member FDIC.

  • Annual Percentage Yield (APY)

  • Minimum balance

    None to open; $1 to earn interest

  • Monthly fee

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle

  • Excessive transactions fee

  • Overdraft fees

  • Offer checking account?

  • Offer ATM card?

Pros

  • Strong APY
  • No minimum balance (just $1 to earn interest)
  • No monthly fees
  • Up to 6 free withdrawals or transfers per statement cycle
  • Easy-to-use mobile banking app
  • Offers no-fee personal loans

Cons

  • No option to add a checking account
  • No ATM access
  • You can’t deposit a check via the mobile app

2. Higher than average interest rates

Your savings account’s interest rate, known as annual percentage yield (APY), determines the amount of interest you earn in a year. The higher your APY, the faster your savings will grow. 

According to the FDIC, the average savings account interest rate in the U.S. sits at a low 0.05%.

When choosing a high-yield savings account, you want to make sure you find one offering an APY greater than the average 0.05% that you would earn in a standard savings account. Keep in mind that the APYs that high-yield savings accounts advertise are variable, meaning they can fluctuate at any time depending on the strength of the economy.

Though most high-yield accounts currently hover around 1% APY, this small increase still makes a difference in how much you earn over time. If you were to make a one-time deposit of $100, it’s the difference between earning five cents or $1 after a year. Some accounts currently provide the opportunity to earn more, such as with the Varo Savings Account, but there are certain monthly requirements you have to meet.

Consider this one: Vio Bank High Yield Online Savings Account

Vio Bank High Yield Online Savings Account

Vio Bank High Yield Online Savings Account

Information about the Vio Bank High Yield Online Savings Account has been collected independently by CNBC and has not been reviewed or provided by the bank prior to publication. Vio Bank is a division of MidFirst Bank, Member FDIC.

  • Annual Percentage Yield (APY)

  • Minimum balance

  • Monthly fee

    None, if you opt for paperless statements (otherwise, $5 per month)

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle

  • Excessive transactions fee

  • Overdraft fees

  • Offer checking account?

  • Offer ATM card?

Pros

  • Strong APY
  • No monthly fees, if you opt for paperless billing
  • Up to 6 free withdrawals or transfers per statement cycle
  • Easy-to-use mobile banking app

Cons

  • $100 minimum balance to open account
  • $5 monthly maintenance fee, if you don’t opt for paperless billing
  • $10 fee per transaction if you make more than 6 in a statement cycle
  • No option to add a checking account
  • No ATM access

3. No bank fees

You shouldn’t have to pay to keep your money in a bank account, so find one that is free to use.

To make sure you are signing up for an account with no added fees, read the terms and conditions, as well as any fine print, before you sign the dotted line.

You’ll notice that some banks waive fees, but require that you make a minimum deposit upfront in order to open an account or to start earning interest. Other banks may charge you a monthly maintenance fee if you don’t maintain a minimum balance in your account.

Look for a high-yield savings account with zero recurring fees, minimums or balance requirements so that you don’t have to worry about any extra expense.

Consider this one: Ally Online Savings Account

Ally Bank Online Savings Account

Ally Bank Online Savings Account

On Ally Bank’s secure site

  • Annual Percentage Yield (APY)

  • Minimum balance

  • Monthly fee

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle

  • Excessive transactions fee

  • Overdraft fees

  • Offer checking account?

  • Offer ATM card?

    Yes, if have an Ally checking account

Pros

  • Strong annual percentage yield on all balance tiers
  • No minimum balance
  • No monthly fees
  • Up to 6 free withdrawals or transfers per statement cycle
  • Option to add a checking account
  • ATM access if you have a checking account

Cons

  • $10 fee per transaction if you make more than 6 in a statement cycle
  • $25 overdraft fee

4. Easy access to your money

When choosing the best savings account, consider account accessibility.

Because high-yield savings accounts serve a great way to build an emergency fund, you want to make sure you have quick and easy access to your money in case an unexpected expense comes up and you need to tap into your savings.

Look for a savings account that offers one or more of the following: ATM access so you can withdraw money whenever you need to; linked checking account so that you can easily transfer funds; mobile app so you can log in and manage your money on the go.

Consider this one: Synchrony Bank High Yield Savings

Synchrony Bank High Yield Savings

Synchrony Bank High Yield Savings

Information about the Synchrony Bank High Yield Savings has been collected independently by CNBC and has not been reviewed or provided by the bank prior to publication. Synchrony Bank is a Member FDIC.

  • Annual Percentage Yield (APY)

  • Minimum balance

  • Monthly fee

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle

  • Excessive transactions fee

    None, but may result in account closure

  • Overdraft fees

  • Offer checking account?

  • Offer ATM card?

Pros

  • Strong APY
  • No minimum balance
  • No monthly fees
  • Up to 6 free withdrawals or transfers per statement cycle
  • Easy ATM access
  • 1 physical branch (in Bridgewater, New Jersey)

Cons

  • Account could close if you make more than 6 transactions in a statement cycle
  • No option to add a checking account

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the CNBC Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.



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