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Standard Savings Account: Moving money around? (lemmy.world)

submitted 1 year ago by kyden@lemmy.world to c/personalfinance@lemmy.ml

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First time poster! Outside of my retirement account provided by work, I'm just beginning to get brave enough to move other money around. I'm very late to the game and pretty scared of gambles.

There are many high yield savings accounts out there right now. Outside of the 6-withdrawl/month restriction are there any things I should be aware of? Do people hop between savings account regularly to keep up with the highest interest rates?

UFB Direct is on the top of many charts. Backed by AXOS bank, but an Internet bank. I've put some cash there but still nervous. Any thoughts on UFB Direct and Internet banking in general? I don't necessarily need a brick and mortar. I think I've been to my local bank less than a dozen times in the lifetime of my account.

Please forgive me ignorance!

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[–] MrSpandex@lemm.ee 8 points 1 year ago

Make sure you compute exactly how much money you'll earn from switching with how long you'll likely stay put. If you'd stay put an entire year and only earn $20, is it worth it?

Rather than chasing the absolute highest rate, I prefer to choose a bank that is regularly competitive. Ally bank, Betterment, and Wealthfront are all ones I'd consider. Alternatively, you can use a money market fund at a brokerage. Those react very fast to interest rate changes and are higher than any bank I know of right now, but have basically been 0% in the past while banks paid up to 1%.

You should not be looking to make decent money off your HYSA - just take some sting out of inflation for short or medium term goals. To make money in the king term, you need to take more risk and invest.