Why you should deposit $10,000 into a high-yield savings account now

Interest rates on high-yield savings accounts are elevated, making it a great time to deposit some money.

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Just a few years ago, interest rates on high-yield savings accounts weren’t exactly high. In 2020, for example, when the interest rate environment was dramatically lower due to the pandemic, rates on high-yield savings accounts were around 0.50%. That left savers with very little opportunity to protect and grow their savings. But as the pandemic waned and inflation rose, the interest rate environment changed dramatically. This has caused the borrowing costs for millions to rocket upward, but it has also raised the benefit of high-yield savings and certificates of deposit (CD) accounts tremendously.

In the rate environment of 2023, savers are essentially losing money by not depositing some or all of their funds into one or both of these account types. High-yield savings accounts, in particular, are especially advantageous right now, particularly if you’re looking for a smart place to deposit $10,000 or more. In fact, there are multiple compelling reasons why you should deposit $10,000 into a high-yield savings account now.

If you’re currently considering a high-yield savings account then start by exploring your options here to see how much more interest you could be earning.

Why you should deposit $10,000 into a high-yield savings account now

Here are three reasons why you should consider depositing $10,000 into a high-yield savings account:

The rate environment is favorable

Higher interest rates are bad news for homebuyers and those who rely on credit cards, but they’re positive for savers looking to make some extra interest on their money. In fact, rates on high-yield savings accounts are currently hovering around 5%, and you may be able to find something even higher if you shop around for an online bank

On a $10,000 deposit, that would equate to $500 after one year — not accounting for the inevitable compound interest that will accompany your savings. That’s a substantial amount of interest, and it dwarfs the minimal 0.45% that most savers are currently getting with their regular savings accounts.

So, if you want to make more money on your savings, a high-yield savings account is a great way to do so now. Get started here.

But the rate environment could change

The benchmark interest rate hit a 22-year high over the summer, settling in at a range between 5.25% and 5.50%. And in a subsequent meeting in September, the Federal Reserve elected to keep rates paused. But they’re unlikely to remain in that range forever. An additional rate hike is possible, if not likely, before the year is out. 

But rate cuts are already being forecast by some experts for 2024. So it makes sense to take advantage of elevated rates now. Interest rates on these types of accounts are variable, so they can and will change over time. But if you move now, you can start earning today’s high rate right away.

You’ll maintain flexibility

Flexibility and ease of use are important in any economic environment but can be particularly beneficial in today’s market. Fortunately, high-yield savings accounts offer this flexibility by working just like regular savings accounts do — just at that higher interest rate. Some lenders will even provide ATM cards so that you can access your account as you do your others. This will allow you to make deposits and withdrawals with ease, all while growing your balance with an elevated interest rate in the interim.

Learn more about your high-yield savings account options here today.

The bottom line

High-yield savings accounts may not have been the best move a few years ago, but they provide a great way to grow your money now. With interest rates near 5% currently, savers should act promptly to reap the immediate benefits, particularly when they know that the rate environment won’t be as favorable for these accounts long-term. Plus, they’ll maintain the flexibility they’re already accustomed to with a regular savings account, making a high-yield savings account in 2023 a rare financial win-win. 

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