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  • High Yield Savings Acct

    Hey everyone,

    I'm looking to move my emergency fund into a savings account with a higher interest rate.  Currently, it's at 0.30% so it's not hard to find one that's going to do better, but I was wondering what everyone's first hand experience has been.

    So far, I'm looking at Ally online savings account (2.20%) and American Express high yield savings account (2.10%).  I'm open to any others that have similar interest rates.

    In addition to a good interest rate, I'm interested in ease of transferring money in and out of the account.  I don't plan to do that more than once or twice a year, but I want to be able to transfer it easily if we end up having to use our emergency fund.  I really want to stick with a savings account over a CD or any other type of investment platform.

    I'd appreciate any feedback that anyone can give.

    Thanks!

     

  • #2
    VUSXX, VMMXX

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    • #3
      I agree with ENT Doc.  If you already use Vanguard it is super easy to just put it in their MMF.  But try not to sweat it too much.  Even if you had a huge efund of 100K a .5% difference is only 500 bucks a year.  And much less after taxes.  That is why I shoot for convenience.

       

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      • #4
        Ally is not always the highest interest savings account but has been most consistently among the highest, and the online and app platforms are very user friendly. I have been using Ally for 7+ years and have been happy with the convenience and performance. I do recommend keeping a brick-and-mortar account, too, just to have access to local bank services if/when you need them.

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        • #5
          Take a look at PurePoint and Marcus by GS. Found their rates to be consistently higher, may not be the most convenient.

          That said, SoFi Money is quite intriguing. Blended checking and savings, 2.25%.

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          • #6
            I’ve been using citizens access for about a year, 2.3 or 2.35 or some such. Leagues better than my brick and mortar, not that it matters a ton in the grand scheme of things, but I feel a little better sitting on cash that way.

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            • #7
              If you live in a state with an income tax, laddering short-term treasuries can be very compelling. The current yield on 1-month treasuries is 2.45%, 3-month 2.47%, 6-month and 12-month are at 2.49%. This interest is not taxed at the state level, so it may be equivalent to a ~2.6% fully-taxable yield if you’re in a high-tax state. In addition, they seem to be as liquid as money market funds, if not more so. My brokerage lets me buy at auction in $1K increments for no commission.

              It looks like 13-week and 26-week treasuries are being auctioned on Monday 3/25, orders need to be in by 10am EST, and 52-week treasuries are being auctioned on 3/26, same time. I already have a ladder of shorter term ones, so I just placed my order for 6-month and 1-year issues for these auctions.

              https://www.treasury.gov/resource-center/data-chart-center/quarterly-refunding/documents/auctions.pdf


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              • #8
                 




                VUSXX, VMMXX
                Click to expand...


                Does anyone know if there is an equivalent good savings option at Fidelity?

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                • #9
                  You could also check your local credit union options. I am able to get 3% on up to 20k in my checking account. Sure, its only 20k, but its a great rate and convenient.

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                  • #10




                     




                    VUSXX, VMMXX
                    Click to expand…


                    Does anyone know if there is an equivalent good savings option at Fidelity?
                    Click to expand...


                    https://www.fidelity.com/mutual-funds/fidelity-funds/overview?selectTab=6?imm_pid=700000001009773&immid=100593&imm_eid=ep10163903298&gclid=EAIaIQobChMI1tmt3cie4QIV1JFbCh2LmQXEEAAYASAB EgJNKPD_BwE&gclsrc=aw.ds

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                    • #11




                      VUSXX, VMMXX
                      Click to expand...


                      What is the advantage of putting the money in a Money Market fund instead of an online savings account like Ally?

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                      • #12
                        Higher yield with more immediate movement on the rate.

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                        • #13







                          VUSXX, VMMXX
                          Click to expand…


                          What is the advantage of putting the money in a Money Market fund instead of an online savings account like Ally?
                          Click to expand...


                          yield.

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                          • #14
                            I actually just switched to Marcus by GS this week. Super easy, 2.25%.

                            There are a couple places going as high as 2.45, but the Marcus interface is easy and only took 5 mins to transfer from USAA.

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                            • #15
                              Why not T-Bills instead of these funds or online savings accounts? What is the disadvantage?

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