rates on savings accounts have been close to zero for a
while. But if youíve been building an emergency cash
fund or got money as part of a graduation gift this
spring, you need to put those dollars somewhere.
your best option?
likely be disappointed if you head to the branch of a
major bank. At these institutions, savings accounts tend
to pay a meager 0.01 percent to 0.15 percent in annual
interest rates were one of the top reasons that
customers switched banks during the past year, according
to the latest banking satisfaction study by J.D. Power.
a better deal, try the following:
around. A national bank is not the only place to park
got to shop around for the highest yields," said
Greg McBride, chief financial analyst at Bankrate.com,
which keeps tabs on banking trends.
can start your search with sites such as bankrate.com,
bestcashcow.com, nerdwallet.com and gobankingrates.com,
which compile the latest offers from banks and credit
unions are not-for-profit organizations and, as a
result, may pay slightly higher interest rates than
to a quarterly report by SNL Financial, which tracks the
financial services industry, the average rate for a
traditional savings account was 0.13 percent nationally
at credit unions and banks as of the end of March.
on other savings products, credit unions had the edge.
example, on money market accounts, which tend to have
higher minimum balance requirements than traditional
savings accounts, credit unions paid 0.16 percent; banks
only 0.12 percent.
have to qualify to join a credit union, which may be
based on where you work, whether someone in your family
is a member or where you live, among other things. For
details, go to mycreditunion.gov.
online. If youíre willing to bank online, you may find
even better deals.
online savings accounts pay as much as 0.95 percent in
annual interest. Whatís more, some of the accounts
have low- or no-minimum balance requirements. Many do
not charge monthly fees. (You can find these offers
using the websites mentioned earlier.)
even bigger payouts, consider a rewards checking
account. Annual rates go as high as 2.5 percent to 3
percent, up to a certain balance (usually $25,000 or
thereís a catch: To get the big yields, you have to
meet specific terms, such as making 10 or more debit
card transactions each month and receiving statements
to meet the terms, and the interest rate drops to a
fraction of a point.
McBride: "You have to be a savvy saver."
community banks and credit unions participate in a
nationwide program for rewards checking called Kasasa.
To find them, go to kasasa.com.
with Uncle Sam. Finally, you may earn a better rate if
you can commit your cash, say, for a year or more. In
that case, consider a Series I saving bond offered by
the U.S. Treasury. The bondís yield is made up of two
parts: a fixed rate that remains unchanged for the life
of the bond, and a variable rate that is adjusted twice
a year with inflation.
bonds bought through Oct. 31, the combined rate is 1.94
percent. If interest rates eventually start to rise, the
I-bondís yield could also go higher. (Likewise, if
rates fall further, the yield could drop.)
can buy the bonds in any amount from $25 to $10,000 per
year. You can cash in the bonds after one year, but if
you redeem before five years, you lose the last three
months of interest. To purchase, go to