Many savers are reluctant to switch their savings accounts. For one, it takes time and effort. Secondly, there’s always the risk that you’ll have to pay a transfer fee if you switch providers. But is it worth staying put? This article explains why switching to the best high-yield savings account might be better for your finances in the long term—and how to go about doing it without breaking the bank.
What Is a High-Yield Savings Account?
A high-yield savings account is a bank account that pays higher interest rates than traditional savings accounts. These accounts are designed to encourage people to save more money, also referred to as reward checking or money market accounts. According to Lantern experts by SoFi, “the savings account’s main goal is usually to keep your money in reserve for when you really need it.”
What Are the Cons of a High-Yield Savings Account?
The biggest downside to a high-yield savings account is that the interest rate is lower than the national average. This may not be a big deal for some people; others will want to keep their money in an account that pays them more for their hard-earned dollars.
Another potential con of a high-yield savings account is that it might have a minimum balance requirement or monthly maintenance fee (which would eat into your earnings). You should also be aware that these accounts are not FDIC insured like most traditional banks and credit unions offer–so if your bank fails, you could lose all of your money!
What Are the Pros of a High-Yield Savings Account?
The pros of a high-yield savings account are numerous.:
- The interest rate is generally higher than that of a traditional savings account and can be as much as 2% or more than that.
- There’s no minimum balance requirement, so you don’t have to worry about keeping track of how much money is in your account at any time.
Unlike most other banks’ products and services (which tend to charge fees), this product doesn’t charge any monthly fees or minimum deposit requirements–making it simple for anyone who wants their money working hard every month!
How Can I Find a High-Yield Savings Account?
Look for a high-yield savings account that has no minimum deposit. You’ll want to find an account with no minimum deposit, as this will allow you to open an account with as little money as possible and still get the benefits of interest payments. Look for an interest rate that is higher than your current bank’s rates but not so high that it would cost too much in fees and other expenses.
Look at the fees and interest rates associated with your new savings account. The best way to do this is by looking at each bank’s website or calling them directly (if possible) before switching over from your current bank’s savings accounts to theirs; this will allow you enough time – about two weeks’ worth of research – before making any big decisions about whether or not switching banks makes sense for your financial situation overall!
“Lantern by SoFi has helped find some of the top providers and what rates they currently offer.” If you can switch to a high-yield savings account, it’s worth considering. This type of account typically offers higher interest rates than traditional savings accounts and CDs. However, there are some downsides to consider before making the switch–including fees and other restrictions that may affect how much money you earn over time.