Earn More on Your Savings These Accounts Let You Eke out Extra Interest on Your Cash

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BANKING » Earn More on Your Savings These accounts let you eke out extra interest on your cash. BY LISA GERSTNER

IF YOU NEED A SAFE PLACE TO The FDIC insures up to than $250,000 through per month. To transfer park your money, you have $250,000 per person per the INCREDIBLE BANK MONEY funds, you can link a sav- a lot of options—as long as bank. That means combined MARKET account (maintain ings account to a checking you don’t expect much in deposit-account balances, a $2,500 balance to avoid account. the way of yield. Short-term including MMDAs as well as a $10 monthly fee; the Best picks: The no-fee SALEM interest rates will scrape checking accounts, savings account does not provide FIVE DIRECT EONE SAVINGS ac- bottom for the rest of 2014. accounts and certificates a check card or paper count yields 1% on balances Depending on how the of deposit, at a single insti- checks). The fee-free SALLIE of up to $500,000 and has economy fares (and how tution for an individual ac- MAE MONEY MARKET account, no minimum balance (the the Federal Reserve re- count owner are insured for which includes check minimum deposit to open sponds), they could go up up to $250,000. Co-owners writing, yields 0.9% with an account is $100). The next year but not by much. of joint accounts are insured no minimum-balance re- SYNCHRONY BANK OPTIMIZER PLUS We’ve rounded up the up to $250,000 per person. quirement. The AMERICANET HIGH YIELD SAVINGS account best spots for eking out more (To see whether your money BANK MEGA MONEY MARKET pays 0.95% on all balances interest on your savings, is fully covered by the FDIC, account offers a yield of (and you need only a $50 depending on how long use the estimator at www 0.9% on balances of up to minimum balance to avoid you can tie up your money. .fdic.gov/edie.) Similar to $35,000 (0.5% on the por- a $5 monthly charge). To find deposit accounts bank deposits, credit-union tion of the balance higher Saving up to go on a big offering top rates, check deposits are insured up to than $35,000), and it comes trip or meet some other sites such as Bankrate $250,000 by the National with a Visa check card. goal? Check out SMARTYPIG. .com and DepositAccounts Credit Union Share Insur- You establish a savings goal .com for banks and credit ance Fund. SAVINGS ACCOUNTS and set up recurring contri- unions in your area that Money market deposit ac- Like a money market de- butions to a free account may offer higher rates than counts often provide checks posit account, a savings that yields 1%. When you the nationally available ones or an ATM card for with- account can be a good place reach your goal, you can let listed here. drawing cash or to use for to stash your emergency the money sit, have it trans- purchases. You can also fund (check whether your ferred back to the funding MONEY MARKET transfer funds electronically MMDA or savings account source, load the money onto DEPOSIT ACCOUNTS to or from a linked checking charges a dormancy fee). SmartyPig’s prepaid card, For your emergency fund— or savings account. You are You can’t write checks from at least six months’ worth limited to six transfers per savings accounts, but you of living expenses—and any month without penalty, not are allowed to make up to other savings that need to including cash withdrawals six withdrawals or transfers be safe and immediately at an ATM. available, look to accounts Best picks: You can earn insured by the Federal De- 0.95% on balances of less posit Insurance Corp., such as bank money market deposit accounts (MMDAs). Stay away from money market mutual funds, which pay practically nothing and aren’t insured by the FDIC.

KIPLINGER’S PERSONAL FINANCE 10/2014

KK10M-EARN10M-EARN MORE.inddMORE.indd 6060 88/5/14/5/14 11:58:58 PMPM get retailer gift cards with (ILLINOIS) FREE REWARDS CHECK- least three months, or continue to earn interest cash-back rewards, or ING account (you’ll earn money earmarked for tu- at higher rates. You can in- choose some combination rates of only 0.1% to 0.2% ition or retirement income. vest in a long-term CD even of those options. on any balance greater than CDs come with maturities if you think you may cash $10,000). Requirements to that typically range from out early or if you want to HIGH-YIELD earn the top rate include three months to five years; take advantage of rising CHECKING ACCOUNTS using your debit card 12 the longer the maturity, the rates; just check the interest If you can meet a few quali- times monthly and spend- higher the yield. penalty in advance to be fications, which usually ing $1,000 or more per It’s best not to lock up sure it’s not too onerous. include banking online and month on one of the credit all your cash in a long-term Best picks: MELROSE CREDIT using a debit card for pur- union’s Visa credit cards. CD, especially with interest UNION recently offered high chases, think about signing (Rates of 3.09% or 4.09% rates as low as they are. If rates on its one-, two- and up for a high-yield checking are available to those who rates go up, you’ll want to be three-year certificates, with account. The amount eligi- meet less-strict require- able to reinvest your money yields of 1.15%, 1.41% and ble to earn the highest rate ments.) The credit union at a higher rate. Construct- 1.66%, respectively. Each is usually capped at about refunds fees from out-of- ing a CD ladder—putting requires a minimum invest- $25,000, and some of the network ATMs. For a yield funds in CDs of varying ma- ment of $5,000. The GE best rates are available only of 3% on up to $15,000, with turities—allows you to rein- CAPITAL BANK one-year CD to residents of the states no minimum balance, check vest cash from shorter-term pays 1.05%, and it has a where the bank does busi- out LAKE MICHIGAN CREDIT CDs as they mature to take $500 minimum deposit. ness. But a few banks open UNION’S MAX CHECKING account. advantage of higher yields. their accounts to residents It refunds up to $15 a month Your longer-term CDs will SAVINGS BONDS of the entire U.S. Many in surcharges from out-of- U.S. savings bonds are an- credit unions require appli- network, non-LMCU ATMs. other supersafe investment cants outside their jurisdic- for money you can afford to tions to make a nominal CERTIFICATES tie up for at least a year. You donation to an affiliated OF DEPOSIT can cash in savings bonds charity. You can find CDs are best for money you after 12 months, but if you insured high-yield accounts can tie up for a few months redeem them before five offered by community or more—say, a portion of years have passed, you for- banks and credit unions your emergency fund that feit the last three months’ at CheckingFinder.com. you wouldn’t need for at worth of interest. Best picks: Earn 5.09% on Series EE bonds pay a up to $10,000 with no mini- fixed rate. After 20 years, mum balance through the Treasury doubles an EE

ALEX_STR/ISTOCK/THINKSTOCK the CONSUMERS CREDIT UNION bond’s purchase value if interest accumulation hasn’t been sufficient to reach that point. The I-bond’s interest rate is composed of a fixed rate that lasts for the life of the bond and a semiannual inflation rate that changes every six months. Best picks: EE bonds pay only 0.5%, but I BONDS have a decent yield of 1.94% (through October). You may purchase from $25 to $10,000 in I bonds per year in an online Treasury Direct account, which you can set up at www.treasury direct.gov. ■

10/2014 KIPLINGER’S PERSONAL FINANCE

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