High interest savings account means funds that are deposited earn a higher interest rate than those offered through conventional bank accounts. It is very important to evaluate high interest savings account sources to obtain the highest return on your investment. It is recommended opening savings accounts with banks that compound interest daily. Consumers can review a variety of banks over the internet to compare minimum opening, balance requirements, service fees, and interest rates.
Banks and credit unions frequently offer perks for opening a high interest savings account to customers. Banks may offer a high rate of interest, but charge inflated fees when balances fall below their minimum requirements. Some banks assess fees for providing paper bank statements or using the of ATM machines. Most financial institutions charge monthly maintenance fees. These banking fees can cost consumers more than they earn in monthly interest which is a downside offered for high interest savings account. It is wise for consumers to seek out banks which compound daily interest and offer complimentary services and explore savings accounts with low opening and / or minimum balance requirements.
Consumers may want to stay away from banks which only offer online banking due to they tend to have higher interest rates than conventional banks. However some conventional banks do also offer online banking as a convenience to their customers.
Many consumers find setting monies aside to place in the high interest savings account as one of the greatest challenges. Financial experts advise consumers to save a minimum of 10 percent of their income for savings but it might be best to start off with at least 5 percent of weekly income striving to reach the 10 percent minimum. This way you may be able to begin sooner contributing to a high interest savings account.
When considering a high interest savings account, first time homeowners should keep in mind that they must provide a down payment using funds from their savings account. Mortgage lenders prohibit borrowers from obtaining down payment assistant from outside sources unless other than a FHA or VA loan or grant money from HUD.
Consumers should take time to do research comparing financial institutes’ interest rates, fees, requirements and perks and before jumping into starting a high interest savings account. Even though this is one savings alternative to consider it is important to read the fine print to determine if hidden fees exit.