The Most Common Mistake People Make With Their Savings (And How to Avoid It)


Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
Knowing what to do with your savings can be a challenge. With so many available banks and different types of accounts, choosing the best place to put your funds can feel overwhelming.
One helpful thing to know is how to avoid the most common mistake people make in this process — not choosing a high yield savings account. This mishap can easily cost you hundreds or even thousands of dollars.
The current national average interest rate for savings accounts is 0.46% APY, according to the FDIC. If you’re trying to collect interest earnings — something you should definitely be doing — this won’t get you very far.
In comparison, the My Banking Direct High Yield Savings Account currently offers a APY. That’s more than 12 times the national average interest rate for savings accounts. No matter what your account balance, this adds up to significantly higher interest earnings.
Choosing a new bank is a big decision. Here’s a look at what you have to gain by putting your savings in a My Banking Direct High Yield Savings Account.
7 Benefits of Choosing a High-Yield Savings Account
If you’ve never put your money in a high yield savings account, you probably have questions — and rightfully so. There’s no shortage of banks to choose from, so you need to be as informed as possible.
You want to make sure your money will be safe, accessible and working hard to earn you interest. Here’s a look at some of the key features of a My Banking Direct High Yield Savings Account:
- Competitive rates: One of the best account features is the APY attached to it. As noted above, this is more than 12 times the national average interest rate for savings accounts.
- FDIC insurance: Your money is insured by the FDIC up to at least $250,000 per depositor. This means you can put your money in savings and feel confident knowing it’s protected.
- Financially stable backing: My Banking Direct is an online bank, but it’s backed by Flagstar Bank, N.A., one of the oldest banks in the U.S., with $113.9 billion in assets under management, as of Dec. 31, 2023.
- Convenient mobile app: Bank from anywhere with the Flagstar Mobile Banking app. You’ll enjoy a variety of features, including the ability to instantly check your balance, fingerprint and FaceID security, mobile alerts and notifications, bill pay, Zelle and mobile check deposit.
- Live customer service: If you’re afraid an online bank won’t offer customer service in human form, fear not. You’re able to talk to a banker seven days per week, meaning there’s always help when you need it.
- No monthly maintenance fees: You shouldn’t have to pay to keep money in your savings account, and with this account, you won’t.
- Low account opening minimum: You only need an initial deposit of $500 to open an account.
Cash In On Your Savings
Maximizing interest earnings is the main reason to put your money in a high yield savings account. If your money is currently in a traditional savings account, you’re missing out on money.
For example, if you have $1,000 in a traditional savings account at the current 0.46% APY average savings account interest rate, you’ll earn $4.61 in interest earnings over the course of a year. However, if you put that $1,000 in a My Banking Direct High Yield Savings Account, you’d earn $57.06 in one year’s time.
Raising the stakes, if you put $10,000 in a traditional savings account and didn’t touch it for 10 years, you’d collect just $470.74 in interest. The same amount of money in a My Banking Direct High Yield Savings Account would garner $7,418.67 in interest earnings.
The numbers speak for themselves. Putting your funds in the wrong type of savings account can cause you to miss out on a significant amount of free money.
How to Start Earning APY On Your Savings
If you’re ready to start cashing in on interest earnings, it’s easy to open a My Banking Direct High Yield Savings Account. Simply fill out an online application at your convenience, and you’ll be set up in no time.
Get started here and see how much more you could be earning in interest.
More From GOBankingRates