High Yield Savings Accounts

There was a recent article in Money Magazine which claimed that 2/3 of Americans have dollars in savings accounts which pay less than 2% APY.  The article went on to say that 20% of the population earn less than 1% and 25% earn nothing at all on their savings accounts. 

While all of you proved your financial literacy a few blog posts ago, we know that you may have family members or friends who might benefit from a reminder about online high yield savings accounts.  These accounts are great for that very important cash reserve that we always talk about.  Account owners can get quick access to cash while generating some income.  Remember that savings accounts of any type are not LFS managed assets, but we are happy to help you (or the friend you are asking for) get an account opened. 

Online high yield savings accounts currently pay about 2.5% APY.  These online banks can pay higher interest because they have lower expenses.  Generally they have no branches or checking privileges and will often limit the number of transactions per month.  That means that account holders will need to electronically link their online savings account to their checking or credit union account.  Luckily this is easy to do. 

There are many online savings accounts available, as a quick online search will reveal.  They have slightly different features, so read the fine print.  We like Synchrony (link attached) because it is FDIC insured up to $250,000 with no monthly fees and no minimum balance.  Withdrawals can be made online 24/7, by phone or via ATM.   Synchrony High Yield Savings accounts are currently paying 2.3% APY. 

Lori

https://www.synchronybank.com/banking-resources/faq/?UISCode=0000000