Key Points
- Savings account helps you to keep and grow your money safely.
- The higher your APY (Annual Percentage Yield), the more money in your pocket.
- List Of Best High-Yield Savings Accounts.
- High-Yield Savings account offers high APY than a Traditional savings account.
What Do You Mean By Savings Bank Account?
A Savings Account is a bank account that is used to store money that you don’t intend to spend right away. The Annual Percentage Yield (APY) of it determines how much interest is paid on funds kept in it. Any bank or credit union will let you start one of these, and you can often make as many deposits as you wish. With the help of a savings account, you can safely grow your wealth while having your cash close at hand.
What Happens To Money Deposited In Savings Accounts?
The money deposited in your savings bank account is used by banks for further funding loans to their customers. An amount of interest is paid by the borrowers from which some amount is sent to your savings account. The higher your balance, the higher will be the interest rate.
What Are The Types Of Savings Account?
The types of savings accounts are as follows:-
Traditional Savings Account
A Traditional Account is a savings account that is easy to open and allows you to withdraw cash from a bank branch near you. With the help of this account, you can also manage your money online. In this type of bank account, APYs are generally low and it also charges maintenance fees if your balance is low.
High-Yield Savings Account
High-yield savings accounts are the most popular account among online banking. This account is much similar to a traditional account but the APY is higher. It does not charge any maintenance fees. people who want basic online banking can opt for this type of savings account.
Money Market Account
Money market accounts are the savings accounts that offer great APY with easy access to their checking account. This account facilitates their customers with checkbooks, debit cards, or maybe both. These types of savings accounts have higher minimum balance regulations than any other savings account.
Certificate Of Deposit (Cd) Account
Certificates of deposit (CDs) are savings accounts that offer their customers higher APYs in comparison with the above-mentioned savings accounts. This bank account has a condition that you cannot withdraw money before the CD term is completed. The term depends on the type you choose, it can be of a few days or five days. If you withdraw your funds before the completion of the term, you have to face penalties.
What Do You Mean By High-Yield Savings Account?
A high-yield savings account is a type of savings account that offers online banks a higher rate of interest than traditional savings accounts. These types of savings accounts pay more than the national average percentage of any savings account. According to the Federal Deposit Insurance Corporation(FDIC), the current APY provided by a High-Yield Savings account is 0.07%.
With providing a high rate of interest this saving account works just like other savings accounts. The bank pays you the interest on your deposited money. You can withdraw money from your account but the bank may charge some fee if the withdrawal is made more than the limit.
Best High-Yield Savings Accounts
Currently, the highest rate you can earn from a national savings account is about 3.50% of the Annual Percentage Yield (APY) provided by the Fitness Bank. This percentage is about 18 times more than that of FDIC’s national average percent of 0.21% APY for the savings account. This rate is one of the top rates mentioned below. Below is a list of top savings bank accounts and their APY rates nationwide.
List Of The Best High-Yield Savings Account With Their APY Rates
- Fitness Bank – 3.50% APY*
- CFG Bank – 3.15% APY
- DollarSavingsDirect – 3.11% APY
- UFB Elite Savings Account – 3.11% APY
- Ivy Bank – 3.10% APY
- North American Savings Bank – 3.10%
APY*
- Valley Direct – 3.01% APY
- BankPurely – 3.01% APY
- iGObanking – 3.01% APY
- Panacea Financial – 3.00% APY
- CIT Bank – 3.00% APY
- Citizens Access – 3.00% APY
- LendingClub High-Yield Savings Accounts – 2.85%.
- First Foundation Bank Online Savings – 2.75%
- Barclays Online Savings – 2.40%
- Discover Online Savings – 2.35%
- Quontic High-Yield Savings – 2.30%
- American Express National Bank 2.25%.
Advantages of a High-Yield Savings Account:
One of the main and first benefits of a High-Yield Savings account is that it offers high APY than other savings accounts. It can easily beat the interest rates of traditional bank accounts. And when the rates of interest are low, your earnings are counted as interest.
High-yield savings accounts may also help you to avoid incurring fees. Online banks often provide these accounts, and these banks don’t frequently charge monthly maintenance costs. This is because internet banks frequently have cheaper overhead expenses than their traditional bank. As a result, companies can provide lower costs and better rates to their clients.
Wrap Up
High-yield savings accounts can help you to earn a higher interest rate than any other traditional savings account. Now, it is easy to find a bank providing the best and high rate of interest. If you are looking for such you can go for online banks. They are a great place to start your account and they will keep your money safe. This also enables you to safely execute all your online banking transactions. There are many banks where you can open accounts with any amount of money. Some banks do not charge monthly maintenance charges and do not require maintaining a minimum balance. This makes it easy for you to save and grow your money at the same time.
