Savings accounts just aren’t what they used to be. Long gone are the halcyon days of the 1980s when a traditional passbook savings account could earn you upwards of 6 percent annual interest. Today, the average rate for such accounts is about 0.06 percent. That’s not very motivating.
While interest rates are low all over, there are other options available that can help you earn a better return on your money. To earn a higher interest rate on your money, consider these five alternatives, curated by casino online, to a traditional savings account.
- Certificates of deposit (CDs)
A certificate of deposit is a type of savings account that accrues a fixed interest rate until a fixed withdrawal date. CDs are offered in varying lengths, from one month to five or more years. Your money is guaranteed to earn a specified interest rate for the duration of that term, after which you can withdraw your money or reinvest in another CD. CDs have solid interest rates, most of which are higher than standard brick-and-mortar bank savings accounts. CDs can also help you fight the temptation to spend a chunk of money that you have set aside for a long-term savings goal.
2. Cash management accounts
Cash management accounts are offered by non-bank financial service providers, often brokerage firms or fintech startups. They combine the features of checking and savings accounts in a hybrid product that isn’t technically a bank account. However, CMA providers typically work behind the scenes with partner banks to sweep their customers’ money into accounts at those banks, giving the funds FDIC insurance. Cash management accounts tend to have much higher annual percentage yields than traditional bank savings accounts and are a solid place to park savings. They are also typically offered by online-only providers, so their remote customer service and online experience are often user-friendly. And if you already have a brokerage account with the same firm, you get the added benefit of having all your accounts under one roof.
- High-yield money market accounts (MMAs)
Money market accounts are savings accounts that tend to come with high interest rates and offer checks or debit cards, unlike a traditional savings account. MMAs often have decently high interest rates, usually better than traditional savings accounts at brick-and-mortar banks. You’ll also have easy access to your funds, unlike with a CD or peer-to-peer lending. It works in the same way you’d expect a game from machines a sous argent reel to yield you some extra cash after wagering.
4. Peer-to-peer lending
Peer-to-peer loans are personal loans funded by individual investors rather than banks. Online lenders — like Lending Club, Prosper or Kiva — provide the platform for investors and borrowers to connect and manage their individual loans. As an investor, you put up a certain amount of money, which is loaned to one or more borrowers who pay it back in regular installments with interest. Peer-to-peer lending tends to be a win-win: Investors get a higher rate of return on their money than a lot of banking products offer, and borrowers get an interest rate on their loan that’s usually less than bank-offered loans and credit cards.
- Online bank savings accounts
Online-only banks provide most (if not all) of the services that traditional brick-and-mortar banks do, with the benefit of high APYs and remote-friendly customer service. A big benefit of having a savings account with an online bank is that they usually come with a higher-yield APY. Though these interest rates are subject to fluctuation, they tend to be 10 or even 20 times higher than brick-and-mortar rates.