Let’s face it, with interest rates sticking around 0%, nobody is going to get rich sticking their cash into a savings account. However, even those of us that have an appetite for risk should always keep a few month supply of cash handy in case of emergency. And if you are going to hold onto that cash anyways, you may as well make some interest in the process. Alternatively, for those risk adverse investors out there, the idea of having a pile of cash around in uncertain times such as these is also very tempting. When considering an online savings account, we like to focus on the following key aspects:
- Annual percentage yield (interest the account pays)
- Minimum deposit or minimum balance required to have the account
- FDIC Membership
- Access to cash
- Any hidden fees
In this list, we are going to only focus on accounts that offer competitive rates, minimum deposits, members of FDIC and do not carry any hidden fees that could impact our interest.
Whether you are saving up for a down payment on a home, saving for an emergency fund or, just saving because you have no confidence in any other investment options, you should be earning something for your money. With most traditional banks offering next to nothing for interest rates, these are all viable and most importantly, SAFE options.