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How to Get More Interest on Your Savings

Some brick-and-mortar banks are offering higher APYs

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If you’ve been frustrated with the low yields on savings accounts in recent years, here’s the good news: Some brick-and-mortar banks are beginning to offer higher annual percentage yields (APYs) on savings accounts, some as high as 1.90 APY.

What’s happening?

Increased rates by the Federal Reserve combined with competition from online banks that offer higher yield savings accounts have spurred some traditional banks to get in the game. CIBC Bank USA, for example, offers 1.90 APY on its high-yield savings account, according to bankrate.com.

Some online savings accounts are paying as much as 2.25 APY. That’s compared with the paltry .01 APY that some major traditional institutions such as Chase, Wells Fargo and PNC are paying, or the .03 APY that Bank of America offers.

Many of the highest yielding savings accounts are offered by online banks. Why? “These (online) financial institutions don’t have the overhead the brick-and-mortar banks have,” said Patrick Daniels, director of financial planning, Precedent Asset Management in Indianapolis.

Among the best online high-yield savings accounts, listed by bankrate.com, are Northfield Bank at 2.25 APY, Customers Bank at 2.25 APY, Salem Five Direct at 2.05 APY and Citizens Access at 2.00 AYP.


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Compared with the yields since the 2008 economic downturn, these savings accounts are worth considering for a couple of reasons. They can be a place to park a three- to six-month emergency reserve or funds to be used toward a major purchase such as a house, car or special trip.

And those who have considerable assets may not be comfortable with having all of them in stocks, mutual funds or bonds. They may want the true liquidity a savings account offers. 

Indeed, whatever assets you have, it’s wise to keep some of them readily available so you won’t have to sell securities if you need cash.

Financial advisers recommend keeping cash in places other than a checking account. Among them are interest-bearing savings accounts or money market accounts. 

If you decide to place some of your assets in a high-yield savings account, some research will ensure the best yield. 

Look at the yield for any account you are considering. According to the FDIC, the annual percentage yield “measures the total amount of interest paid on an account based on the interest rate and the frequency of compounding.”

Is the interest compounded daily, monthly, quarterly or simply annually? The more frequent the compounding, the faster your money can grow. A compounding calculator can help determine your potential yield. 

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