> What savings I did have where in a zero interest current account though!
That's not great, but overall, I'm not making very much money from my "high-interest savings account". Maybe a grand or two over decades, but even that's generous. I don't know if it's worthy of an exclamation mark. The biggest losses are prevented by not overspending and some of the other things you mentioned.
Very true. Reminds me of this quote I had saved (I don't recall the source)
"Personal-finance gurus obsess over buying coffee not because it is unsustainable, Vanderkam suggests, but because being a personal-finance guru is. “The strongest finance advice can be summed up in a couple sentences,” she explains. Maximize your income. Limit your big monthly expenses. But if your job depends on doling out financial wisdom, Vanderkam notes, “you have all this real estate you have to fill on your blog, your podcast, and your books. That’s where all this little stuff winds up coming in, but in the larger scheme, it’s kind of irrelevant.”
In hindsight it’s something extremely basic, simple and obvious to do which is why I had the exclamation mark for my lack of knowledge.
In the past couple of years I’ve made $2-3k in interest. Not much but it’s $2-3k I wouldn’t of had if sat in a checking account so to me it’s free money for holding the exact same savings just under a different account with my bank.
>my "high-interest savings account". Maybe a grand or two over decades
Huh? Either you have very little savings for someone on this site, or your "high-interest" account isn't high-interest. Ally Bank currently has 1.6% interest on their savings account, so you'd make $1000 in interest in 1 year with a balance of about $62k. If your savings account doesn't have at least 1.5% interest, then why do you have it? There's lots of places with rates of 1.5-2%.
It's unusual to have $62k or more in a savings account.
Either it's some sort of 6-month emergency fund and CDs typically make more sense (ladder or not) or it's money you want to grow, in which case investing in index funds is the better approach.
>It's unusual to have $62k or more in a savings account.
You're not paying attention. The OP said it would take decades to make $1k or $2k; I pointed out it doesn't take that much money to make that in only 1 year. It's not that unusual to have $30k in savings, so that's roughly $1k in interest in 2 years, which is an order of magnitude lower than what the OP was claiming.
I get 5% interest on up-to a $20,000 balance in a high interest checking account. You'll see higher returns using a high interest checking as opposed to savings account if you can find one you qualify for.
I clicked through a few of those offers. Each one has a balance limit (after which interest drops to near zero), monthly fees, sign-up fees, or requires you to generate banking fees through another service.
And how could they not? Finance isn't magic, and we are in a world of all-time low rates. There is no possible way these companies can be paying you 5% on cash without making it up elsewhere.
The accounts typically have sign up bonuses, not fees. I got $125 bonus for signing up. The catch is typically that they require usage of the bank debit card N times per month. The github link is a program I wrote to hit that requirement by buying 50 cent Amazon gift cards and paying cable bills in small increments.
You'll never net more than $1000/year in one of these accounts given they have balance limits. Some folks sign up for multiple high interest checking accounts in order to park more money.
As I said in my prior message, Ally Bank has 1.6% on savings. I think CapitalOne 360 has either 1.6 or 1.7, Discover has something similar, etc. I think Tab Bank has a little higher rate. These aren't hard to find. You probably won't find a full 2.0% anywhere currently.
That's not great, but overall, I'm not making very much money from my "high-interest savings account". Maybe a grand or two over decades, but even that's generous. I don't know if it's worthy of an exclamation mark. The biggest losses are prevented by not overspending and some of the other things you mentioned.