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>my "high-interest savings account". Maybe a grand or two over decades Huh? Either you have very little savings for someone on this site, or your "high-intere

by magduf 7y ago

>my "high-interest savings account". Maybe a grand or two over decades Huh? Either you have very little savings for someone on this site, or your "high-interest" account isn't high-interest. Ally Bank currently has 1.6% interest on their savings account, so you'd make $1000 in interest in 1 year with a balance of about $62k. If your savings account doesn't have at least 1.5% interest, then why do you have it? There's lots of places with rates of 1.5-2%.

potatoz2 7y ago
It's unusual to have $62k or more in a savings account. Either it's some sort of 6-month emergency fund and CDs typically make more sense (ladder or not) or it's money you want to grow, in which case investing in index funds is the better approach.
- magduf 7y ago
  >It's unusual to have $62k or more in a savings account. You're not paying attention. The OP said it would take decades to make $1k or $2k; I pointed out it doesn't take that much money to make that in only 1 year. It's not that unusual to have $30k in savings, so that's roughly $1k in interest in 2 years, which is an order of magnitude lower than what the OP was claiming.
isoskeles 7y ago
Really, 2%, where? Also, that’s probably going to get knocked down this week given the announcement from the Fed, unfortunately.
- jakehilborn 7y ago
  I get 5% interest on up-to a $20,000 balance in a high interest checking account. You'll see higher returns using a high interest checking as opposed to savings account if you can find one you qualify for. High interest checking accounts: https://www.doctorofcredit.com/high-interest-savings-to-get/#Mega_High-Interest_Nationwide https://www.doctorofcredit.com/high-interest-savings-to-get/... Automation for meeting minimum spend requirements: https://github.com/jakehilborn/debbit https://github.com/jakehilborn/debbit
  - aguyfromnb 7y ago
    >High interest checking accounts: I clicked through a few of those offers. Each one has a balance limit (after which interest drops to near zero), monthly fees, sign-up fees, or requires you to generate banking fees through another service. And how could they not? Finance isn't magic, and we are in a world of all-time low rates. There is no possible way these companies can be paying you 5% on cash without making it up elsewhere.
    - jakehilborn 7y ago
      The accounts typically have sign up bonuses, not fees. I got $125 bonus for signing up. The catch is typically that they require usage of the bank debit card N times per month. The github link is a program I wrote to hit that requirement by buying 50 cent Amazon gift cards and paying cable bills in small increments. You'll never net more than $1000/year in one of these accounts given they have balance limits. Some folks sign up for multiple high interest checking accounts in order to park more money.
- magduf 7y ago
  As I said in my prior message, Ally Bank has 1.6% on savings. I think CapitalOne 360 has either 1.6 or 1.7, Discover has something similar, etc. I think Tab Bank has a little higher rate. These aren't hard to find. You probably won't find a full 2.0% anywhere currently.
  - isoskeles 7y ago
    I know they aren't hard to find, I have an account at Ally Bank. My question was specifically 2%. Anyway, 1.6% is going away given the Federal Reserve just cut rates by 50 bps yesterday. Expect an email from Ally soon.

by magduf 7y ago

potatoz2 7y ago

It's unusual to have $62k or more in a savings account. Either it's some sort of 6-month emergency fund and CDs typically make more sense (ladder or not) or it's money you want to grow, in which case investing in index funds is the better approach.

magduf 7y ago
>It's unusual to have $62k or more in a savings account. You're not paying attention. The OP said it would take decades to make $1k or $2k; I pointed out it doesn't take that much money to make that in only 1 year. It's not that unusual to have $30k in savings, so that's roughly $1k in interest in 2 years, which is an order of magnitude lower than what the OP was claiming.

isoskeles 7y ago

Really, 2%, where? Also, that’s probably going to get knocked down this week given the announcement from the Fed, unfortunately.

jakehilborn 7y ago
I get 5% interest on up-to a $20,000 balance in a high interest checking account. You'll see higher returns using a high interest checking as opposed to savings account if you can find one you qualify for. High interest checking accounts: https://www.doctorofcredit.com/high-interest-savings-to-get/#Mega_High-Interest_Nationwide https://www.doctorofcredit.com/high-interest-savings-to-get/... Automation for meeting minimum spend requirements: https://github.com/jakehilborn/debbit https://github.com/jakehilborn/debbit
- aguyfromnb 7y ago
  >High interest checking accounts: I clicked through a few of those offers. Each one has a balance limit (after which interest drops to near zero), monthly fees, sign-up fees, or requires you to generate banking fees through another service. And how could they not? Finance isn't magic, and we are in a world of all-time low rates. There is no possible way these companies can be paying you 5% on cash without making it up elsewhere.
  - jakehilborn 7y ago
    The accounts typically have sign up bonuses, not fees. I got $125 bonus for signing up. The catch is typically that they require usage of the bank debit card N times per month. The github link is a program I wrote to hit that requirement by buying 50 cent Amazon gift cards and paying cable bills in small increments. You'll never net more than $1000/year in one of these accounts given they have balance limits. Some folks sign up for multiple high interest checking accounts in order to park more money.
magduf 7y ago
As I said in my prior message, Ally Bank has 1.6% on savings. I think CapitalOne 360 has either 1.6 or 1.7, Discover has something similar, etc. I think Tab Bank has a little higher rate. These aren't hard to find. You probably won't find a full 2.0% anywhere currently.
- isoskeles 7y ago
  I know they aren't hard to find, I have an account at Ally Bank. My question was specifically 2%. Anyway, 1.6% is going away given the Federal Reserve just cut rates by 50 bps yesterday. Expect an email from Ally soon.