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High-Yield Savings Accounts
Old 05-16-2013, 09:59 AM   #1
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High-Yield Savings Accounts

I've been looking at what to do with my cash savings and was looking at opening a high-yield savings account, as my current account yields .05% and I've seen rates at or above 1%. Who would have thought that comparing savings accounts would be so difficult?

I'm looking for a place with a good combination of rates, decent, convenient service, and no fees. Anyone have any experience with this sort of thing or recommendations? Are there any good alternatives to high-yield savings accounts. I likely won't be needing the money soon, but would like to stay somewhat liquid.
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Old 05-16-2013, 10:16 AM   #2
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I use Barclay's online savings account, for a whopping 1% yield. That's one of the best out there. Sadly...
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Old 05-16-2013, 10:17 AM   #3
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Not sure how much cash you are talking about, but you could divide it into the amount that needs to be liquid and the amount that won't likely need to be liquid. You could consider savings bonds, short term bond funds, or REITs. But all these have downsides. With savings bonds, you cannot redeem them for 12 months (I think). Bond funds and REITs can also go down in value. It depends on how much risk you want to take.
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Old 05-16-2013, 10:43 AM   #4
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It also depends on how many years of needed "liquid cash" this represents. If it's more than you reasonably expect in a year, you can ladder CDs while keeping one year's worth of reserves in a fully liquid savings account of some sort. But it's not hard to get much better than 0.05%; there are still several options paying as much as 0.80% and maybe even a little more.
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Old 05-16-2013, 10:44 AM   #5
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Alternatives I've used for parking cash, all have some pro's and con's

Discover Bank online: FDIC, pay about 0.8%
Ally Bank online: FDIC, pay about 0.84%
GE Interest Plus:not FDIC, pays up to 1.1%, no diversification
Duke Premiernotes:not FDIC, pays up to 1.5%, no diversification
Vanguard, T Rowe Price, Short Term Bond Funds: principal amount varies, not FDIC, roughly 1.5%, has some diversification
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Old 05-16-2013, 10:56 AM   #6
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The one thing I don't like about FIDO is their ridiculously low % on cash. I have about $60k I was sick of seeing just languish for the convenience of it being right there with all our accounts. So I looked around and signed up for AMEX online savings, 0.85% (WooHOO! ). Easy to set up (bothered me a little that I gave it my FIDO numbers and without any action over there it in fact grabbed the money!). Only thing I don't like is that it seems to sit in the AMEX account for 6 days before it's "available." I guess it's to discourage rapid fire movement, which is no problem for me. Just a little unnerving for someone to acknowledge that, yes, we have your money now but you can't access it for another 5-6 days!
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Old 05-16-2013, 11:30 AM   #7
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I'm still at ING Direct (now Capital One 360) at 0.85%.
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Old 05-16-2013, 12:16 PM   #8
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Decided to go with an American Express High-Yield Personal Savings Account. While they might not have the highest yield (.85% Hah!), there were far fewer reports of users having service issues.

Yes, I currently make and survive quite well on 45k a year. I could probably get by without much hardship on 30k a year. I just checked my balances and I have the following:

$6.5k checking
$12.2k low-yield savings
$20k high-yield savings
$1k money market
$3.7k savings bonds - series EE
$7.8k foreign currency - Pounds Sterling
$9.3k profit sharing retirement fund
$25k Roth IRA
$21k home equity (on 119k mortgage @3%)

I really need to work on my allocation and start getting into investing.
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Old 05-16-2013, 02:26 PM   #9
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I am currently considering either an EverBank or Capital One account for the relatively high interest and no/low fee international ATM access to cash.
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Old 05-16-2013, 03:33 PM   #10
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I have had good experience with AMEX. ACH initiated one day, funds hit my checking account at USAA next day.
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Old 05-16-2013, 03:41 PM   #11
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I opened up a bunch of 5 year CDs at AllyBank. I think they are now paying around 1.5%.

The reason that I did this is that you can redeem the Ally bank CDs prematurely and only loose a very small penalty for early withdrawal (60 days). There is also no minimum CD size and you can have multiple CDs of the same term.

Also I opened up a Mango Money card and savings account and was able to get ~5% on up to $5,000.

-gauss
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Old 05-16-2013, 03:55 PM   #12
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Also I opened up a Mango Money card and savings account and was able to get ~5% on up to $5,000.

-gauss
Do you do direct deposit to get that rate? (Now 6%) By design the good rate stops at $5K and wondering if it is worth the trouble.....
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Old 05-16-2013, 04:00 PM   #13
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Do you do direct deposit to get that rate? (Now 6%) By design the good rate stops at $5K and wondering if it is worth the trouble.....
I do an ACH push transaction from my ING Checking account of $50 each month to Mango to qualify for the rate. No paycheck is involved.

The rate turns out to be closer to 5% then 6% if you don't want to spend over $500/month on the Mango Card (which I don't). For monthly spends of less than $500 they charge you $5/month which is close to 1% on a $5,000 balance.

-gauss
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Old 05-16-2013, 04:10 PM   #14
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Originally Posted by H2ODude View Post
The one thing I don't like about FIDO is their ridiculously low % on cash. I have about $60k I was sick of seeing just languish for the convenience of it being right there with all our accounts. So I looked around and signed up for AMEX online savings, 0.85% (WooHOO! ). Easy to set up (bothered me a little that I gave it my FIDO numbers and without any action over there it in fact grabbed the money!). Only thing I don't like is that it seems to sit in the AMEX account for 6 days before it's "available." I guess it's to discourage rapid fire movement, which is no problem for me. Just a little unnerving for someone to acknowledge that, yes, we have your money now but you can't access it for another 5-6 days!
I didn't give my AMEX account my FIDO numbers, I did it the other way around. I initiate the transfers from FIDO to Amex, and the funds appear the next day or two and are immediately available.

Amex has my bank checking account numbers. I initiate the tranfers from Amex to the bank, and it appears available the next day first thing!

If you initiate the transfer from the side sourcing the money, there will be no wait for funds to be available once they appear in the account. This avoids a bunch of verification checks which is what that 6 days wait is actually for.

There is a limit of six withdrawals a month from the High Yield savings accounts - but no other kind of throttling.
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