![]() How much difference can earning a higher interest rate on savings make? Here’s an example. ![]() High yield savings accounts offer a significantly higher annual interest rate than traditional savings accounts. But, overall, high-yield savings accounts can serve more than one purpose as part of your financial plan. You’ll likely be better off with a tax-advantaged retirement account or a taxable investment account-either can offer more room for growth. For example, you might open an account to set aside money for any of the following:Ī high-yield savings account isn’t often a good fit for retirement savings. You can use high-yield savings accounts for a variety of goals. ![]() You can make withdrawals as needed, though your bank may charge a fee if you make more than a certain number of withdrawals per month. You deposit money into the account, and, in return, the bank pays you interest. These accounts pay several times more than the national average of savings accounts, which is an average 3% interest rate as of Main India.Īside from the higher interest rate, high-yield savings accounts work the same as other savings accounts. ![]() What Is a High-Yield Savings Account?Ī high-yield savings account is a deposit account-typically offered by online banks and credit unions-offering a much higher interest rate than traditional savings accounts found at brick-and-mortar banks. Wondering if a high-yield savings account is right for you? Understanding the basics of high-yield savings accounts can help you decide if you should open one.Īnnual percentage yields (interest rates) and account details are accurate as of March 6, 2023. High-yield savings accounts are accounts that offer substantially higher interest rates than the national average of traditional savings accounts.
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