The Power of Interest in Banking
I realized that my bank has online check paying for a reason: interest. If you think about it they get to transfer the money from your account into their account and they make interest on that money until the check gets cashed. It more than covers any expense that may exist in sending the checks. Especially since they control when the funds transfer. Banking needs interest to make it worthwhile to not make fees their source of income. I’m going to attempt to maximize my high interest savings account over time to make sure that I get the most money in interest possible for short term holding of my own cash.
Are you maximizing the interest you could be making?
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September 4th, 2007 at 12:15 pm
Since you and I talked about high-yeild savings, I checked into the savings accounts available at Wells Fargo. They are a joke. Seriously. If I had $100,000+ to put into a savings account, I could garner a little over 3% interest annually. Anything less than $10,000 gets 0.1% and you have to maintain a $3000 minimum balance. I’m currently making about 14 cents a month on the money I have in there (less than $3k, so I have a lower rate account). Pft. Gimme a break. If I had that much cash burning a hole in my pocket, I’d find something better to do with it than earn $10 a year.
September 4th, 2007 at 12:38 pm
Trint, My higher interest account is with Washington Mutual. You may want to take a peek at what they offer, it could be just the ticket, that one returns 5% a year. If you had $100,000 plus you’d be better off finding some other investments with great yields. I recommend a high interest savings accounts for certain things like small amounts saved for quarterly taxes, money from an ‘emergency fund’, or for kids who are saving money up for some long term investment such as a PS3. Definitely check out your options, but with larger sums of money there are better long term investments.