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3 Mistakes To Avoid When Choosing a Bank Account, According to Ramit Sethi
3 Mistakes To Avoid When Choosing a Bank Account, According to Ramit Sethi

Yahoo

time9 hours ago

  • Business
  • Yahoo

3 Mistakes To Avoid When Choosing a Bank Account, According to Ramit Sethi

If you're looking to open a new bank account to store your savings, you may narrow your options down to two types of accounts: a money market account or a high-yield savings account (HYSA). They have a lot in common — they both generate interest, they both generally allow you easy access to your money and they both, if with a FDIC-backed institution, provide coverage up to $250,000. Find Out: Read Next: But, as financial expert and self-made millionaire Ramit Sethi discussed on his website, I Will Teach You To Be Rich, there are differences between a money market account and a HYSA. For example, the former usually comes with transactional features, like a debit card and/or checkbook, while HYSAs are more exclusively geared toward growing your money. To make the best choice for you and your money, be careful to avoid common mistakes when deciding to open a new money market account or HYSA. When dealing with any transaction or onboarding process, it's so tempting to quickly scroll through all the fine print and just get to the parts where you sign and submit. All that fine print is so repetitive, tedious and dense. But this stuff is important — it's where you'll learn everything about fees and requirements. A financial institution may blast promotional messaging about 'no fees,' but often there's a caveat if you, say, drop below a minimum balance requirement or let your account sit idle with no new deposits. 'Banks often hide important fee information in the account terms and conditions,' Sethi wrote. 'Many people open accounts without understanding how maintenance fees work or what minimum balances they need to maintain. These fees can sneak up if you don't keep the required amount in your account, turning your interest earnings into monthly charges.' If you're not quite grasping what the fine print says, copy the text and paste it into ChatGPT, then ask the AI chatbot to explain it all in simple language, without repetition. When choosing a home for your savings, you need to find the bank account that will (safely, with FDIC backing) give you the highest interest rate. This will most likely be delivered by an online-only bank, not a traditional brick-and-mortar. Banks that operate exclusively online can afford to offer high interest rates because they don't have high infrastructure or overhead costs as traditional banks do. 'Traditional banks often rely on customer loyalty and convenience, offering much lower interest rates than their online competitors,' Sethi said. When searching for a new HYSA or money market account from an online bank, you're going to be blasted with a lot of marketing from banks that suggest they have the best interest rate around. Who really has the best interest rate though, and on what terms? 'Taking a few minutes to compare different online banking options could earn you substantially more interest on your savings,' Sethi wrote. A money market account can act in some ways like a checking account, which is one of its appeals, but at their cores, the two are different beasts. Sethi warned against treating a money market account like a checking account. Doing so could slam you with fees. 'One of the costliest mistakes comes from misusing money market accounts,' Sethi said. 'Despite their check-writing features, these accounts aren't designed for regular transactions. Many people treat them like checking accounts and end up paying fees for exceeding transaction limits.' Understand the ways in which your money market account works not only like a checking account, but like a HYSA. It likely limits the types of transactions, for example, whereas a checking account doesn't. At the end of the day, you may be wondering why your bank accounts, in terms of all the technical fine print, matter so much. Well, ultimately, it's all part of building wealth. Consider Sethi's wisdom here, 'Managing your accounts effectively is just one piece of building a strong financial foundation.' More From GOBankingRates 3 Reasons Retired Boomers Shouldn't Give Their Kids a Living Inheritance (And 2 Reasons They Should) This article originally appeared on 3 Mistakes To Avoid When Choosing a Bank Account, According to Ramit Sethi

I Know You Don't Want to Hear This, but It's Time to Start Your Holiday Savings. I'll Make It Easy for You
I Know You Don't Want to Hear This, but It's Time to Start Your Holiday Savings. I'll Make It Easy for You

CNET

time23-06-2025

  • Business
  • CNET

I Know You Don't Want to Hear This, but It's Time to Start Your Holiday Savings. I'll Make It Easy for You

Getty Images/Viva Tung/CNET Can you believe we have only six months until Christmas? That can feel like plenty of time, especially when we haven't even started back-to-school shopping yet. But with stores starting holiday sales earlier and earlier, I want to be prepared. And with tariff uncertainty already raising prices, I want to be prepared so I don't overspend or turn to credit cards during the holiday season. So yes, I'm saving for "the most wonderful time of the year" now, and you should, too. Here's my holiday savings plan and where I'm stashing the money until I need it. How I'm saving for the holidays now Starting this week, I have an automatic transfer set to move $50 from my checking account to my high-yield savings account every time I get paid. Since I'm paid twice a month, that will add up to $550 by Dec. 1. By starting now, I'll also have a good amount saved if any deals or sales pop up sooner, like on Black Friday. If I buy a gift before I hit my $550 goal, I'll deduct it from my budget to avoid overspending. If you also want to plan ahead, figure out how much you can comfortably afford to move into a savings account each pay period. Even if you can afford only $25 a month, you'll still have $150 saved before the end of December. How a high-yield savings account makes it easy I'm keeping my holiday fund in my high-yield savings account. I use Ally Bank, which offers a 3.60% annual percentage yield, but any bank offering you over 3.5% APY will do. I won't earn much in six months by only depositing a couple of hundred dollars, but it's better than what I'd earn by letting it sit in a checking account or traditional savings account earning 0.02% APY at best. Ally's high-yield savings account also comes with two unique features that I love. First, it offers goal-tracking so I can see how close I am to reaching my holiday fund goal. And Ally's savings buckets help me keep my holiday fund separate from my emergency fund without opening a separate account. Interest and savings features aside, keeping this money in an account separate from my checking and everyday spending prevents me from accidentally dipping into it. If you struggle with impulse buying, keeping money that's earmarked for other goals separate can help eliminate this temptation. If you don't already have a high-yield savings account, check out CNET's recommendations. Look for an account with a competitive APY, no monthly fees and easy access so you can quickly transfer your funds.

Best high-yield savings interest rates today, June 23, 2025 (Earn up to 4.31% APY)
Best high-yield savings interest rates today, June 23, 2025 (Earn up to 4.31% APY)

Yahoo

time23-06-2025

  • Business
  • Yahoo

Best high-yield savings interest rates today, June 23, 2025 (Earn up to 4.31% APY)

Today's savings account rates still hover well above the national average. The Federal Reserve cut the federal funds rate three times in 2024, which means deposit account rates are also on the decline. It's more important than ever to ensure you're earning the highest rate possible on your savings, and a high-yield savings account could be the solution. These accounts pay more interest than the typical savings account — as much as 4% APY and higher in some cases. Not sure where to find the best savings interest rates today? Read on to find out which banks have the best offers. In general, high-yield savings accounts offer better interest rates than traditional savings accounts. Still, rates vary widely across financial institutions. That's why it's important to shop around and compare rates before opening an account. As of June 23, 2025, the highest savings account rate available from our partners is 4.31% APY. This rate is offered by VIO Bank and there is no minimum opening deposit required. As you'll see, the majority of top savings rates come from online banks. These institutions have much lower overhead costs than traditional banks, so they can pass those savings on to customers in the form of higher rates and lower fees. Here is a look at some of the best savings rates available today from our verified partners: This embedded content is not available in your region. A high-yield savings account can be a good fit if you're looking for a secure place to store your money and earn a competitive interest rate while maintaining liquidity. Traditional savings accounts and certificates of deposit (CDs) have some of the highest interest rates we've seen in more than a decade, thanks to recent interest rate hikes by the Federal Reserve. Even so, the national average for these rates is fairly low compared to the top offers available. For example, the average savings account rate is just 0.38%, while 1-year CDs pay 1.62%, on average, according to the FDIC. The Fed is also expected to lower its target rate again in 2025, which means now might be the last chance for savers to take advantage of today's high rates. Taking the time to compare accounts and rates from various financial institutions will help you secure the best deal available. However, interest rates aren't the only factor to consider when choosing a savings account. For example, some banks may require that you maintain a minimum balance to earn the highest advertised rate and avoid monthly fees. Other factors to evaluate include customer service options and hours, ATM and branch access, digital banking tools, and the overall financial stability of the institution. Additionally, before opening a savings account, be sure that it's insured by the Federal Deposit Insurance Corporation (FDIC) — or the National Credit Union Administration (NCUA) if it's held by a credit union — so your money is protected in case the institution fails. Read more: How to open a savings account: A step-by-step guide

$20,000 CD vs. $20,000 high-yield savings account: What to consider right now
$20,000 CD vs. $20,000 high-yield savings account: What to consider right now

CBS News

time11-06-2025

  • Business
  • CBS News

$20,000 CD vs. $20,000 high-yield savings account: What to consider right now

We may receive commissions from some links to products on this page. Promotions are subject to availability and retailer terms. Both CDs and high-yield savings accounts could be viable places to store $20,000 right now. Getty Images Certificates of deposit (CDs) and high-yield savings accounts have traditionally offered savers similar benefits. Both come with higher interest rates than can be found with regular savings accounts. And both have seen rates spike in recent years thanks to an elevated interest rate climate. Accordingly, each account type has given savers a much-needed boost when their funds were otherwise being damaged by inflation and higher borrowing costs. But that doesn't mean they're equally as beneficial, either. While the differences between the two may be negligible with smaller deposit amounts, as savers look to put more money into either, concerns over differences become more pronounced. This is particularly true for savers looking to boost their interest on five-figure amounts, like $20,000. If you're comparing a $20,000 CD against a $20,000 high-yield savings account now, for example, there are some timely considerations to think about before getting started. Below, we'll break down three of them. See how much interest you could be earning with a high-rate CD here. $20,000 CD vs. $20,000 high-yield savings account: What to consider now Don't rush into depositing this much money into one of these accounts before first examining these three timely items: The interest-earning potential CD and high-yield savings account rates are comparable. Rates on short-term CDs, for example, are between 4.31% and 4.49% now, while they're between 4.25% and 4.31% for high-yield savings accounts, according to Bankrate data. While that may seem like they have the same interest-earning potential, the details here matter. Those CD rates will mature after the account term ends in three to six months, while the high-yield savings account rates could change before that point, thanks to a variable rate that changes frequently for savers. In other words, you'll need to do the calculations to determine which can earn you more interest over time. While rates are similar now, they may not remain so for much longer. Compare your high-yield savings account options online today. Upcoming rate changes Depositing $20,000 into a 6-month CD with a rate of 4.49% can earn you more than $400 now. But doing the same with a high-yield savings account likely won't. With rate cuts appearing more likely for later this year, rates on high-yield savings accounts may fall at the same time that the CD rate remains fixed. While Fed rate cuts won't impact savings account rates by the same margin, there will be an impact. And with the CME Group's FedWatch tool listing a September 2025 rate cut as a more than 67% likelihood, this could hurt savers relatively soon, especially considering that banks don't have to wait for formal rate cuts to adjust the rates they provide savers. Understanding this possible reality, then, savers may want to put their $20,000 into a CD instead. Access to your money A CD requires savers to leave their money untouched for the full CD term or risk having to pay an early withdrawal penalty to regain access. And $20,000 is a lot of money to lose access to, particularly if it's for a long-term CD of more than 12 months. Savers will need to judge for themselves if this is both worth the return and simple to do. If it's not both, then it may be better to put that money into a high-yield savings account, even if it means having to endure predictable rate cuts later this year and in 2026. Consider, then, the early withdrawal penalties of a CD versus the changes in rates that high-yield savings accounts may come with to better determine which is more valuable for your unique situation. The bottom line The decision to deposit $20,000 into a CD or high-yield savings account now should be primarily guided by the above three considerations. There won't be a one-size-fits-all answer, however, so view these guidelines through your own financial prism to determine an answer. And don't leave your money in a traditional savings account. With rates there under 0.50% now, you're essentially losing money by not taking advantage with a CD or high-yield savings account now, even if the economic climate appears a bit unpredictable.

Jenius Bank review (2025): Simple online banking with competitive rates and no fees
Jenius Bank review (2025): Simple online banking with competitive rates and no fees

Yahoo

time03-06-2025

  • Business
  • Yahoo

Jenius Bank review (2025): Simple online banking with competitive rates and no fees

Summary: Jenius Bank is the digital banking division of SMBC MANUBANK, a California state-chartered commercial bank based in Los Angeles. Jenius Bank offers personal loans and high-yield savings accounts. Jenius Bank offers the following products and services: The Jenius High-Yield Savings Account is currently offering a 4.20% APY — that's more than 10 times the national average for savings accounts. There are no monthly fees or minimum balance requirements for this account and interest is compounded daily. Jenius personal loans start at $5,000 and go up to $50,000 with rates from 8.99% to 23.49%. There are no loan origination fees, prepayment fees, or charges for late or missed payments. Repayment terms for a Jenius personal loan range from 36 months to 72 months. Jenius is not currently accepting personal loan applications on its website. However, you may be able to qualify for a Jenius loan if you apply through Intuit Credit Karma or Lending Tree and meet eligibility embedded content is not available in your region. Jenius Bank does not charge any fees for its savings accounts. Additionally, you will never pay loan origination fees, prepayment fees, late or missed payment fees, transaction fees, and the like as a Jenius customer. Here are some of the major pros and cons of banking with Jenius Bank: Pros: Competitive interest rate for high-yield savings account: Jenius Bank's high-yield savings account offers 4.20% APY, which is one of the highest rates available. No fees or minimum balance requirements: Jenius does not currently charge any fees for its accounts or personal loans. There is also no minimum balance requirement to keep your account open or avoid fees. 24/7 customer service: Jenius bankers are available to chat 24/7. Cons: Limited account options: Jenius only offers savings accounts and personal loans. It does not currently offer checking accounts, money market account accounts, credit cards, or other types of financing. This could be a drawback for customers with more extensive banking needs. No physical branches: Jenius operates online only and does have any physical branches for customers to visit. Certain products are not available in every state: Jenius savings accounts are not available for residents of Hawaii or New Mexico. Additionally, Jenius is not accepting personal loan applications from residents of Hawaii, Nevada, or Wisconsin. Jenius Bank representatives are available to assist customers 24/7 at 844-453-6487. Jenius also has a mobile app available for download on the App Store and Google Play. The app has a rating of 4.3 stars and 3.9 stars, respectively. Customers can use the app to view account balances, transactions, and account details, transfer money between accounts, and more. Yes, Jenius savings deposits are FDIC-insured up to the federal limit of $250,000 per depositor, per ownership category. Jenius Bank's routing number is 122045354. Jenius Bank is the digital division of SMBC MANUBANK, a California state-chartered commercial bank and wholly owned subsidiary of SMBC Americas Holdings, Inc., a member of SMBC Group.

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