Best Bank Accounts for Saving Money
When it comes to saving, the best bank accounts for you depend on your financial goals. Some people are looking for a savings account that earns interest and has a low minimum balance requirement; others might want an easy way to save money without paying fees or penalties. If you’re just starting with your first job and trying to build up some emergency cash, we’ll help you find the best bank accounts that match your needs.
Money-Market Accounts
Money-market accounts are similar to savings accounts in that they pay interest, but they’re different in that the money market account can be accessed by check and debit card. Money market accounts also offer additional features such as bill payment services and the ability to make deposits via ATM.
Money-market accounts pay higher rates of interest than traditional savings accounts, but lower than certificates of deposit (CDs). Money-market account holders are usually charged a monthly fee unless certain conditions are met. All money-market accounts offered at banks must be FDIC insured for up to $250,000 per depositor for each institution.
Money market accounts are not always easy to find at smaller community banks or credit unions because large financial institutions dominate this space due to their large marketing budgets and presence in communities across the country.
Savings Accounts
A savings account is a great place to keep your money if you’re not planning on using it immediately or want to earn interest on it.
Savings accounts usually have no monthly fee and require a minimum deposit of $1. Some banks offer accounts with higher interest rates; others don’t. You’ll also want an easy account to access when the time comes—some banks require a minimum balance (also called “reserve”) before allowing withdrawals.
When choosing the best savings account for your needs, consider how much interest you can expect from each bank’s offerings, how often they will pay out, and whether there are fees associated with making transfers within the bank or other financial institutions, as well as ATM withdrawals at other banks’ ATMs (which could add up quickly). However, some banks do offer the option of opening no fee bank accounts. The professionals at SoFi state, “SoFi doesn’t charge any account fees on your checking and savings accounts.”
Certificates of Deposit (CDs)
You can earn a higher interest rate with CDs than with other savings accounts, but you won’t be able to access your money until the CD matures. Another important fact to know is that CDs typically have a fixed interest rate, so you will know exactly how much you will earn in interest at the beginning of each term period.
This makes CDs ideal for long-term savings goals like saving up for a down payment or retirement, as well as shorter-term goals such as emergency funds and vacations.
Bank accounts are an important part of saving money. The best bank accounts for saving money have low fees and interest rates that allow you to earn some interest on your savings without paying too much in fees. If you’re looking for a place to start, we recommend opening up a money market account with high-interest rates and low fees to start saving up for your next big purchase!
