Have you ever considered how an interest bearing savings account could help you to save money while at the same earn interest – better yet, a high interest savings account? If you have not considered this financial option, learn how this can help you save more money.
Higher interest savings accounts are safe and secure with FDIC insurance protection which will help you leverage your finances for rainy days. Depending on the amount of expendable income that you have for your budget for a high interest savings account, this will fluctuate from person to person based on personal finances. However, some experts recommend that a good rule of thumb is that 10% should be allotted per paycheck to be transferred into a high interest savings account to help build a nest egg for emergencies or even long term financial planning purposes.
Until the recent turn of events, it was not much of a priority for Americans to save money. With home values rising – many Americans thought they could afford to spend more money and many took out equities from their homes – this meant that most working people in the U.S. were spending more money than they earned and accruing debt at a higher than average rate. Now that the current recession is grasping most Americans by their wallets, frugality is the in thing and many are storing their extra cash into high interest savings accounts. The AP Economics Writers, “Americans Saving More, Spending Less,” (February, 2009) stated that the rate of Americans saving more money rose to 2.9% for the last quarters of 2008.
Those who have opened a high interest savings account have seen growth in their savings. This proves that high interest savings accounts works and are great tools for those who really need to save money for important financial decisions. Depending on market conditions, interest rates on high interest savings accounts can range anywhere from 1.75% to maybe 5%. Currently, online savings accounts give better interest rates for savings accounts and is about 1.87% APY.