If you are a saver, they you know that interest rates on savings accounts have plummeted lately. I remember just a couple ofÂ years ago, many online banks offered savings accounts with interest rates at or above 5%. Now, my ING Direct savings accounts yields about 1.6%.
Even money market accounts, which typically yield higher than savings account rates are now less than 0.5%. Also,Â a quick glance at bankrate will show you the horrible rates offered from CD’s. A 6 month CD is about 1.7% while locking your money down for 1 year will only give you 2.3%.
With all the bad rates where can the savers turn to, to increase their savings rates? High-yield online checking accounts may be a solution. Some high-yield interest rate checking accounts are offering slightly over 6% interest rates on your money!
There are some requirements from these great checking accounts, but nothing that is impossible to meet. Most require the use of a debit card a certain number of times per month, at least one automatic direct deposit, and/or use of online banking at least once per month. If you don’t meet the requirements for that period your interest rate will be significantly reduced. Even if you don’t meet the requirements for a given month you are still earning some interest on your money.
Some people may still be concerned about the security of online banks and online banking. With so many hackers out there trying to get your hard earned money how do you know that an online bank is a safe place to put your money? I’m no expert on Internet security, but I would be willing to bet that online banks are more secure than your hometown bank. There are more security measures in place to protect your money than the security guard at the bank.
You can increase the security by increasing your knowledge of how the Internet works. Online banks or any other financial institution will never ask for personal information or passwords via email. Always disregard these emails or report them to the proper authorities. Also never give you passwords to anyone! Never click links in emails to go to your banks website, always type the address in the web address bar. There are many spoof or fake emails trying to get your personal information. Follow these simple rules and your online high-yield checking account will help earn you some money, even in this bad economy.