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Traditional banks like Bank of America and Chase may offer the convenience of physical branches and extensive ATM networks, but when it comes to savings account yields, they fall short. With national average annual percentage yields (APYs) at a low 0.46%, these brick-and-mortar banks often offer even less, sometimes as low as 0.01% APY. This means you’d earn merely 1 cent per $100 annually.
The Least Profitable Savings Accounts
Accounts from traditional banks come with various fees, such as monthly maintenance fees, which can further diminish your returns. For example:
Bank of America Advantage Savings: Offers a base APY of 0.01%, which can increase for Preferred Rewards members. However, it comes with an $8 monthly fee (waivable under certain conditions) and a limit of 6 free withdrawals or transfers per statement cycle.
Chase Premier Savings℠: Also starts at 0.01% APY, with the potential to increase up to 0.05%. This account has a higher monthly fee of $25 but offers similar terms regarding transactions and potential fee waivers.
Despite these drawbacks, customer loyalty and the convenience of face-to-face services keep many consumers with these institutions.
Where to Put Your Money Instead
For better returns, consider online-only high-yield savings accounts. They typically offer higher APYs due to lower overhead costs. These accounts are accessible, FDIC-insured, and often come without hidden fees.
Some top high-yield savings accounts with APYs above 5% include:
UFB Secure Savings: Up to 5.25% APY, no monthly fees, and free ATM card with unlimited withdrawals.
Western Alliance Bank High-Yield Savings Account: Offers a competitive 5.22% APY, no monthly fees, and up to 6 transactions each month.
Newtek Bank Personal High Yield Savings: Provides a solid 5.25% APY, no monthly fees, and free withdrawals or transfers up to 6 times per statement cycle.
Fixed-Rate Alternatives: Certificates of Deposit (CDs)
If you’re looking for stability, CDs might be your best bet. They offer fixed APYs for specific terms, sometimes over 5%, from banks like Synchrony Bank and Quontic Bank.
FAQs
Which savings account will earn you the least money? Typically, traditional savings accounts offer lower interest rates compared to other savings options like high-yield accounts.
Safe alternatives to savings accounts to make more money? Consider high-yield savings accounts, money market accounts, certificates of deposit (CDs), or investment accounts for higher returns.
Which savings account will earn you the most money? High-yield savings accounts generally offer higher interest rates than traditional savings accounts.
Savings account alternatives Reddit? Reddit users often discuss options like online savings accounts, peer-to-peer lending, and investing in stocks or mutual funds.
What was the average interest rate for the savings accounts? The average interest rate can vary, but traditional savings accounts typically offer around 0.06% APY.
Which of the following statements about savings accounts is false? Any statement claiming that savings accounts offer high-risk investments would be false.
Savings accounts typically offer more interest than which type of account? They usually offer more interest than checking accounts.
Why is it important to reconcile your bank account? Reconciling helps you catch errors, fraud, and keep track of your finances accurately.
What type of savings account earns the least money? Traditional or basic savings accounts usually earn the least due to lower interest rates.
Which savings account will earn you the least money, compound or simple? Accounts with simple interest typically earn less than those with compound interest over time.
Which savings account will earn you the best money? High-yield savings accounts often provide the best returns among savings accounts.
What type of savings account earns the most money? Again, high-yield savings accounts typically earn the most due to higher interest rates.
What kind of savings account is best? The best account depends on your financial goals, but high-yield accounts are often recommended for better earnings.
Which account is best to save money? High-yield savings or money market accounts are good options for saving money with better returns.
What is the best saving account to put money in? Look for an account with a high APY, low fees, and good customer service.
What is better than saving money? Investing can potentially offer better returns than saving if you’re willing to accept some risk.
What is better than a savings account? Investment vehicles like stocks, bonds, or mutual funds may offer higher returns than a traditional savings account.
What is the biggest disadvantage to savings accounts? The main disadvantage is their relatively low interest rates compared to other investment options.
Is it better to save or invest? It depends on your financial goals and risk tolerance; saving is lower risk but investing may offer higher returns.
Which is the safest bank for a saving account? Look for FDIC-insured banks as they offer protection up to $250,000 per depositor, per insured bank, for each account ownership category.
Which bank is giving 7% interest in savings accounts? Some online banks may offer higher interest rates; however, it’s essential to verify their credibility and FDIC insurance status.
Where should I put a large sum of money? Consider diversified investment portfolios, high-yield savings accounts, or CDs for large sums of money.
How to save money and not spend it? Create a budget, set financial goals, and use automatic transfers to a separate savings account to avoid temptation.
What is the 50/30/20 rule? Allocate 50% of income to needs, 30% to wants, and 20% to savings and debt repayment.
What is the 30-day rule? Wait 30 days before making a non-essential purchase to avoid impulse buying.
How to save with little income? Prioritize expenses, eliminate unnecessary spending, and save small amounts consistently over time.
How to save 10k in 6 months? Set a strict budget, cut down on expenses, increase income through side jobs, and save around $1,667 per month.
How to make money quickly? Consider freelance work, selling items you no longer need, or participating in paid surveys or gigs.
How do I save with no money? Focus on reducing expenses and finding ways to