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Thread: High Interest Bank Accounts?

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    Default High Interest Bank Accounts?

    I'm looking for a simple bank account that accumulates more interest than a normal one, I know Bank of America and Wells Fargo offer these, but I have also heard people mention an online account with ING or Charles Schwab, something different like that. Thoughts? Suggestions? I want to have access to my money at all times though.
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    Default Re: High Interest Bank Accounts?

    by requiring access to your money at all times, you must basically 'write off' CD's since these carry an early withdrawl penalty if the principal must be withdrawn before the term of the CD expires. For a 'high interest' demand deposit situation, you're looking at a Money Market account ...



    However, be aware that the new FinReg law has provisions that will affect Money Market accounts. What difference this may make nobody really knows yet. Also, money market accounts impose fees if the number of transactions exceeds a certain number ( I think with ALLY / Schwab etc. it's more than 6 transactions per month ), meaning that if you plan to use this account for writing checks, paying bills etc. that the fees will eat you alive.


    however, if your intent is to use this for accumulation of savings, such that you would only need instant access to your principal in an 'emergency' situation, then CD's may be worth considering after all. In the case of ALLY bank, the early withdrawl penalty is the forfeiture of 2 months worth of interest earnings ... which is not a big deal compared to earning 2.9% interest during all of the other months.

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    Default Re: High Interest Bank Accounts?

    So you would suggest this ALLY bank over Schwab, HSBC, ING, etc.?
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    Default Re: High Interest Bank Accounts?

    Try checkingfinder.com It will show you high interest checking accts in your area. There will be restrictions and hoops you'll have to jump through (i.e. min. number of signed debit transactions, etc.) but generally worth it. I'm earning 4% on $25000 max. and federally insured.

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    Default Re: High Interest Bank Accounts?

    I have an ING account and LOVE it. You can get accounts with a card linked, you get 4.9%p.a. (in Australia anyway, not sure if it's the same in the states), I've never paid any sort of fee to them (but I don't have a card for the account, that might have fees, not sure) and you can easily set up term deposits online with them to get better interest rates. Very easy to transfer money between the savings account and your everyday account.

    Insured and interest paid on up to $1,000,000, they also quite often have special rates where you'll earn a higher interest rate on extra money deposited in a certain time.

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    Default Re: High Interest Bank Accounts?

    Ally Bank is a division of GMAC, and as such is virtually guaranteed 100% backing by US taxpayers against ( another ) corporate bankruptcy . ING is based in Belgium, has no such gov't backing against bankruptcy ( although the FDIC insures US deposits ), and is on the European bank 'worry list'.

    Also be aware that accounts in different countries / currencies have different associated interest rates. As a US resident, you will be 'locked into' US dollar denominated accounts and interest rates. The only exception I know of is - which allows US residents to open accounts / purchase CD's that are not US dollar denominated. Being able to deal in other currencies means that, for example, a zero interest rate Swiss Franc CD account can translate into a 10% 'profit' because the US dollar versus Swiss Franc exchange rate moved 10% during the term of the CD !!!

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    Default Re: High Interest Bank Accounts?

    HSBC and Countrywide (financial, not lending)

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    Default Re: High Interest Bank Accounts?

    Quote Originally Posted by J.D. View Post
    I'm looking for a simple bank account that accumulates more interest than a normal one, I know Bank of America and Wells Fargo offer these, but I have also heard people mention an online account with ING or Charles Schwab, something different like that. Thoughts? Suggestions? I want to have access to my money at all times though.
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

    How about looking into some local credit unions? Their rates are often better than the banks. Sometimes, just being an area resident qualifies one to join a credit union. By "access to money", I'm guessing that you want checkwriting and/or ATM access. At either place, getting a "good rate" entails having a minimum ammount on deposit ( varies, but often north of $5K), and limits on number of withdrawls that you can make (usually 3-6).
    Last edited by minnow; 07-30-2010 at 05:38 PM. Reason: typo
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    Default Re: High Interest Bank Accounts?

    http://www.getrichslowly.org/blog/20...count-is-best/

    you want that list because they update it as soon as rates go up or down. also, that site links to similar lists for money market accounts and CDS. rates are ridiculously low right now for a number of reasons. anyone offering more than 1-2% will generally not be giving you convenient access to your money or they only pay a decent rate on the first 500-1k or some other catch. but that is a good list for americans and i've found it to be accurate whether rates are decent or terrible.

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    Default Re: High Interest Bank Accounts?

    Quote Originally Posted by Melonie View Post
    Ally Bank is a division of GMAC, and as such is virtually guaranteed 100% backing by US taxpayers against ( another ) corporate bankruptcy . ING is based in Belgium, has no such gov't backing against bankruptcy ( although the FDIC insures US deposits ), and is on the European bank 'worry list'.

    Also be aware that accounts in different countries / currencies have different associated interest rates. As a US resident, you will be 'locked into' US dollar denominated accounts and interest rates. The only exception I know of is http://www.everbank.com/001Currency.aspx - which allows US residents to open accounts / purchase CD's that are not US dollar denominated. Being able to deal in other currencies means that, for example, a zero interest rate Swiss Franc CD account can translate into a 10% 'profit' because the US dollar versus Swiss Franc exchange rate moved 10% during the term of the CD !!!
    So not only would I be earning a set interest rate, but also whatever the exchange rate difference is (but this could be a loss) on top of that, correct?
    Quote Originally Posted by AznExtasy View Post
    LMAO!!!!!!!!!!!!!!!!!!!!!!
    You can say that again.. not just on here but men in general. Guys are so damn lame, the only way they can halfway make up for it is by opening their wallets.

    Created by MyFitnessPal.com - Tools

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    Default Re: High Interest Bank Accounts?

    Quote Originally Posted by Melonie View Post
    by requiring access to your money at all times, you must basically 'write off' CD's since these carry an early withdrawl penalty if the principal must be withdrawn before the term of the CD expires. For a 'high interest' demand deposit situation, you're looking at a Money Market account ...

    http://www.ally.com/bank/money-marke...unt/rates.html

    However, be aware that the new FinReg law has provisions that will affect Money Market accounts. What difference this may make nobody really knows yet. Also, money market accounts impose fees if the number of transactions exceeds a certain number ( I think with ALLY / Schwab etc. it's more than 6 transactions per month ), meaning that if you plan to use this account for writing checks, paying bills etc. that the fees will eat you alive.


    however, if your intent is to use this for accumulation of savings, such that you would only need instant access to your principal in an 'emergency' situation, then CD's may be worth considering after all. In the case of ALLY bank, the early withdrawl penalty is the forfeiture of 2 months worth of interest earnings ... which is not a big deal compared to earning 2.9% interest during all of the other months.

    https://www.ally.com/bank/high-yield...762#tabs=rates
    This is exactly my intent. I don't want my money "locked away" per se.
    Quote Originally Posted by AznExtasy View Post
    LMAO!!!!!!!!!!!!!!!!!!!!!!
    You can say that again.. not just on here but men in general. Guys are so damn lame, the only way they can halfway make up for it is by opening their wallets.

    Created by MyFitnessPal.com - Tools

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    Default Re: High Interest Bank Accounts?

    So not only would I be earning a set interest rate, but also whatever the exchange rate difference is (but this could be a loss) on top of that, correct?
    Yes that is the essence of these foreign currency denominated CD's, or for that matter ANY 'foreign investment'.


    This is exactly my intent. I don't want my money "locked away" per se.
    then a Money Market account is probably your best bet.

    Let's talk realistically for a moment. Odds are that your annual earnings are at a level where your 'marginal' tax rate next year will be pretty high. By this I mean that for every additional dollar you earn ( in this case interest earnings on your savings / money market / CD ) is probably going to be somewhere near the 33% ballpark. As such, you're not really comparing a 2% versus 1.2% interest rate - but a 1.33% versus 0.8% interest rate net of additional income tax. So the actual dollar difference between 'locking up' your money in a 2% account versus keeping your money available in a money market account is really only .53% net of additional income tax !

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