Read time: 2 minutes
Okay, I’ve had enough.
Can we agree that one of the worst financial mistakes is keeping your money in a Traditional Savings Account? — I’m talking about big banks like Chase, Bank of America, and Wells Fargo.
The problem is, you barely earn any interest on your money.
Traditional Savings Accounts offer a measly 0.01% interest rate, meaning if you keep $10,000 in them, you’ll only receive $1 in interest by the end of the year.
And I’m guessing you’re probably not jumping for $1 when you could earn 400x more…
The first thing I always recommend people do is to keep their money in a High Yield Savings Account (HYSA) instead because HYSAs pay you significantly more.
For example: My favorite HYSAs offers some of the highest interest rates available today, 4.35%. This means if you keep $10,000 in them, you’ll receive $435 in interest by the end of the year.
That’s real money — and we’re not even talking about investing.
The good news is: A HYSA is free, takes only 5 minutes to set up, allows you to access your money anywhere, and doesn’t require you to do anything differently.
Hold your horses…
But not all HYSAs are created equal… Here are 3 important things that you should lookout for:
Interest rate matters. You want to know how much interest these accounts are paying you because you’re trying to get the most out of your money.
Fees. Make sure there are zero fees, otherwise those fees are just going to eat into any interest you earn, and we don’t want that happening.
FDIC insured. You want to make sure that the online bank is FDIC insured because this will protect your money up to $250,000 if there’s a bank failure.
To save you time from over-thinking and over-analyzing everything, I put together a list of the HYSAs that I recommend.
The HYSAs on this list have some of the highest interest rates available today, have no fees, FDIC-insured and are:
Ideal for your 3-6 month emergency fund
Perfect for creating separate savings accounts based on your goals (such as a house down payment or vacation fund)
Let’s make smarter money moves,
— Vincent
Vincent Chan
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