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What is a High Yield Savings Account?

 
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Interest rates much higher than the national average.

Description: A savings account with a high interest rate and a low fee, sitting on a laptop computer.

Are you looking for an account that pays more than the national average interest rate? A high-yield savings account is the perfect solution. High-yield savings accounts offer interest rate that are much higher than the national average for standard savings accounts. This means that you can get more money from the interest your savings earn. But what exactly is a high-yield savings account and how does it work? This article will explain everything you need to know about high-yield savings accounts.

In most ways, an online high-yield savings account is similar to a traditional savings account at a brick-and-mortar bank. However, you'll typically find that online high-yield savings accounts have higher interest rate and lower fees than traditional savings accounts. This is because online banks don't have the overhead costs associated with maintaining physical branches.

But many now offer savings accounts with annual percentage yields of 3.3% or more. While the benefits of moving money into a higher-paying account may seem obvious, it’s important to understand how a high-yield savings account works.

savings accounts: 3% APY or higher. In early 2022, some of the best savings accounts earned a mere 0.50% annual percentage yield. Today, the average APY for high yield savings accounts is between 0.50% and 1.00%. However, some accounts offer up to 3% APY.

Today's savings rates; savings $10K · 0.22%; savings $25K · 0.46%; savings $50K · 0.47%; Higher Yielding savings Accounts, 0.83%.

A high-yield savings account is a kind of savings account that pays interest rate that are much higher than the national average for standard savings accounts. These accounts are typically offered by online banks and credit unions, as they don't have the overhead costs associated with maintaining physical branches. High-yield savings accounts offer higher interest rate than traditional savings accounts, as well as lower fees.

The High Yield savings account from American Express, Member FDIC, is a stand-alone savings account that pays a high rate of interest on any balance. This account offers an APY of 0.80%, with no minimum balance required and no monthly fee. The account also provides access to more than 55,000 ATMs and allows customers to manage their accounts online.

“If you haven't checked the rate on your savings account lately, now is a good time.” As interest rate have risen over the past few years, so have high-yield savings accounts. It’s important to compare rates and fees offered by different banks to make sure you’re getting the most out of your savings.

“CD rates tend to be higher than high-yield savings accounts because you're locking up your money for the term of the CD. Consider a CD ladder, where you invest in multiple CDs with different maturity dates, to get the most out of your savings.”

The Federal Reserve is set to send savings and CD rates higher yet again. If your savings are still sitting at a bank where rates have barely budged, now is the time to consider transferring your money to an online high-yield savings account.

Labels:
savings accountshigh yield savingsannual percentage yieldapyinterest ratesonline bankscredit unionsfederal reserve

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