How often should you buy a new savings account?

Finding a new savings account on a regular basis can help you maximize your income and reach your financial goals faster. (iStock)

Whatever your financial goals, putting your money in one or more savings accounts can help you build up your balance by taking advantage of higher account rates to maximize returns. Many savings accounts offer benefits that allow you to reach your savings goals with little or no monthly fees. For example, you could earn more money with high yield savings options through Credible. High yield savings accounts generally offer exponentially higher interest rates than normal savings accounts.

However, you don’t have to just dump your money into a standard savings account. Finding the right savings account means identifying accounts that offer certain benefits that meet your unique financial needs and goals. A different savings account can be used for different purposes and can be used in place of a credit card, personal loan, or even using funds from your checking account. Since interest savings rates and account programs can change at any time, buying new savings accounts regularly can actually help you maximize your returns and ensure you don’t lose money.

What Should You Look For When Buying A Savings Account?

There are many types of savings accounts and each financial institution may offer different terms for these accounts. When shopping for a new savings account, it’s important to consider all of the factors that influence your maximum earnings, including:

  • Interest rate
  • Minimum balances
  • Fresh
  • Easy access to the account
  • Duration of maturity

It is always a good idea to compare several savings accounts before making a decision. Visit Credible to explore high yield savings options that could earn you money.

HOW TO CHOOSE A HIGH RETURN SAVINGS ACCOUNT

1. Interest rate

Financial institutions are not required to offer the highest interest rate available, which is why you should always compare multiple rates from different banks.

2. Minimum balances

Some types of savings accounts will require you to maintain a minimum balance. If your account falls below the minimum balance, you could be penalized.

3. Fees

In addition to any possible minimum balance fees, some banks may charge a monthly maintenance fee for your savings and checking account, which will ultimately limit your maximum earnings.

4. Ease of access

Depending on the type of savings account, you may be limited in how often you can access these funds. For example, a money market account may offer a higher interest rate than a traditional savings account, but it may only allow you to withdraw those funds a few times a month without penalty.

5. Duration of maturity

There are other forms of savings accounts that also have higher interest rates than traditional savings accounts, for example a certificate of deposit. CD rates are competitive rates and have a guaranteed rate of return; however, you are required to keep your savings on the CD until it reaches its predetermined maturity date. It can be as short as a month or as long as five years.

If you want to discover quick and easy ways to save money, you should visit Credible to find a high yield savings option that best fits your unique savings goals.

How often should you buy new savings accounts?

There is no single, correct way to manage your savings. Some experts suggest opening a new savings account for each of your financial goals. Others advise limiting your accounts to ensure consistent deposits and ease of maintenance. Ultimately, opening a new savings account should be at your own pace, convenience, and comfort.

If you’re new to savings or can only deposit small amounts, it’s best to open a savings account and shop around for a better interest rate every six months or every year. If you have large sums of money, you can benefit from comparing the rates of new accounts every three to six months to ensure you are maximizing your returns.

While you may be happy with your current savings account, it’s never a bad idea to shop around and compare the latest rates.

HOW MUCH MONEY SHOULD YOU KEEP IN SAVINGS?

What is the national average interest rate on a savings account?

As of April 1, 2020, the FDIC reports a national deposit rate of 0.07% and a national rate cap of 0.82%. for savings accounts. At the time of writing, the national APRs for high yield savings accounts are between 0.52% and 0.6% on average. A significant influence that can increase or decrease these savings rates is the benchmark interest rate set by the Federal Reserve, which influences the rates on a savings account, personal loan, credit card, or loan. real estate, etc. When the Fed cuts its benchmark rate, interest rates are lowered. The federal government and other local economic factors that influence the reduction of these savings rates include:

  • The current deposit volume in a specific bank
  • Stimulation controls
  • Paycheque Protection Program Loans
  • Unemployment premiums

While these factors can lower interest rates across the board, you can still make sure you get the best interest rates available by researching new savings accounts. If you don’t want to leave money on the table, you can maximize your income with these high yield savings options on the Credible Market.

Have a financial question, but don’t know who to ask? Email the Credible Money Expert at [email protected] and your question could be answered by Credible in our Money Expert column.


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