This blog post is under “married life”, but honestly, this applies to every person with a savings account. I know money (or finances) isn’t the most exciting thing to talk about for most people but it is super important. This is a topic I’ve been excited to share because we have truly enjoyed the benefits of it!
It wasn’t until late last year that Jose and I started learning about high yield savings accounts. A high yield savings account is usually through an online bank and it offers a higher interest rate compared to a brick-and-mortar bank. An online bank will offer an interest rate of at least 2.10% while traditional banks may offer an interest rate as low as 0.01%. Pretty insane, right? To help put this concept into perspective, here is a really good article by Bankrate explaining what it means to lose purchasing power. The following resonated with me on so many levels, “A commonly used inflation gauge currently sits at 1.6 percent. Meanwhile, the national savings average yield is only at 0.1 percent annual percentage yield (APY). What this means for you is if your money is yielding less than 1.6 percent APY, you’re losing purchasing power.” If you have a savings account with Wells Fargo, Bank of America, or any of these large brick-and-mortar banks, you basically fall into this category of losing purchasing power in the long run. It doesn’t serve you to have hundreds or thousands of dollars sitting in a savings account with traditional banks.
Most high yield savings accounts do not require a minimum or charge fees. The funds are easily accessible, and depending on which bank you decide to go to, you can pull whatever amount whenever you need it. Also, a few banks do offer ATM access, but personally, I rather not have an ATM card because I do not have to worry about it being stolen. For a list of high yield savings accounts options, I am going to link two resources for you:
These resources provide a brief description of top online banks, should be helpful in deciding which one is best for you.
Also, in case you missed last week’s blog post about the tool we use to budget, I’ll go ahead and link it here. It’s the best tool to date and love how it simplifies our lives.
This was short and sweet but to the point. If you have any questions about which bank we use, feel free to reach out and I can share more!
Hope you have a wonderful day,