Which Online High-Yield Money Market & High-Interest Savings Account is Best?

We’ve reopened comments on this post as of today. If you have any questions or know of a great rate being advertised, please submit a comment.

The previous comment on investing overseas is NOT about currency speculation. I wish I currently had the guts to do the same.

As a South-African living in the USA I have some insight into what the poster was saying.

The South African currency is one of the most volatile, but yet stable currencies. Why do I say that? Well it can lose or gain 10 or 20% within a few days, BUT it moves within a certain range and it bounces in that range.

A few months ago the currency was 6 ZAR to the USD, now it is 8 to the USD. Couple that with the fact that interest rates in the country is 6 to 10 times what it is in the US and you get the scenario where say you invested now at 6% with currency you buy at 8 ZAR to the USD. When it goes back to 6 – 6.50 to the USD, you can make a 25 – 35% currency profit on top of the higher interest rate.

So typical wisdom would be, invest when the dollar is stronger, pay out when the dollar is weaker.

Personally I don’t know why the ZAR always return to strength. After Mandela the country has only been run by greedy criminals and it is getting worse. Maybe it is the amount of money foreign investors push into the country, maybe it is because mineral resources seem to shine when other instruments don’t?

Hello!
I’m 19 y/o, from México. I’ve been following your blog and newslater for a while now. I’ve found your posts to be highly educational, besides being entertaining. haha keep Blackberry.

I have a question. For what I understand, Savings accounts in the US yield more interest than the ones available here in México(although i haven’t really researched much yet). I’ve heard about online savings accounts… what’s the difference between them and “offline” ones? Can I apply for one from México? And are there any US banks in méxico that I can go to and create a savings account?

Thank you very much!

ING recently started providing checks (50 for $5), something that makes an already great checking account even better, but I won’t be ordering any until well after they are merged with Capital One, first because of the probable name change on the checks, but secondly because I figure Capital One will do something to screw ING checking up (though I doubt they’ll do anything as gross as Wells Fargo and they ridiculous $3.00 debit card fee)!

FYI

Ing is in the process or has been acquired by Capital One and the process should be completed by the end of the year.

Ing’s Electric Orange checking is also nice, the Orange Savings Account currently offers a better rate.

Ing also has Sharebuilder.

Sharebuilder, for new accounts, sometimes has incentives on My Points.

Look for changes as the Capital One acquisition nears completion.

Since late 2007 Internet HSY rates have dropped steadily from above 5% to 1% at best currently. Everybody seems to be complaining about this, and rightly so. For a better understanding of the reasons behind this change, I urge you to watch Charles Ferguson’s brilliant 2007 documentary film, “Inside Job”.

ING is great! You get a $25 bonus for opening an account there. This site has a bunch of links to get one: http://sicksaver.blogspot.com

My Amex on-line savings just dropped to less than 1%. I agree with Tony its a joke. The interest rates on savings have continued to drop and it happens quietly without any media attention.Now it looks like the fed wants to keep interest rates at zero for years.

Josh: just what exactly are you talking about regarding 4 or 5% tax free? Please elaborate.

I remember back when savings accounts were 5 percent, wasn’t too long ago. This is why I don’t understand people’s savings habits though, because with a little planning ahead your savings dollars could be earning 4 or 5 percent tax free.

Every day you don’t earn interest on your dollar is opportunity lost.

Lapeer County Bank and Trust in Lapeer MI has a “Green Rewards” checking/savings account that earns 2.51% APR. Limit in account is $50,000 but can open more than one. There are certain items have to meet each month: on-line bill pay (only one a month), use debit card 12 times a month, anthing over 50,000 is less % rate. Check it out at lcbt.com

I’ve had a smarty pig account for more than a year. I moved my ING and Ford interest advantage monies to smarty pig. It is now at 1.35 APY. It was earning more (over 2%) when I signed up, but still outperforms Ford Int Adv & GE Int plus, and is FDIC insured in addition.
I have not taken money out of smarty pig yet, and hopefully it will be as easy as making contributions. I see it no differently than my ING savings. I will stick with smarty pig until either I reach the $50,00 max to earn this rate, or 12 month cd’s begin to out shine 1.35 APY.

SmartyPig has been brought up time and time again in the comments to this thread, but truth be told, it really isn’t a savings account per se. Anyone interested in Smartypig had best read the documentation carefully before leaping in.

Wow, I picked a bad time to be in a financial crisis. If you have any more advice for my financial situation, which you can see at http://www.budgetssuck.com I would love to hear it, thanks.

I just opened an Amex savings account at 1.15%. I see some comments on here talking about 5% APY accounts. Am I missing something or is this just the way things are right now, capping at 1.15%?

TJ… good comments.

I’d add just one thing… I think the “high yield money market & high interest savings account” discussed here is just a part of your overall savings and wealth strategy. For me, this is my 6-month emergency fund and is more about security than wealth-building. I don’t want to take risks with this money – it’s there for me should I need it, should funds be short one month or if some unforeseen disaster hits. Those of you who have such a fund know how good it feels to have it – you always have that to fall back on if needed. No sleepless nights worrying about money. 1% is lame, no question. But this is money I need to be secure, no-risk, and available anytime I need it. In other words, a SAVINGS account.

Now… as far as “building wealth” goes, there is my 401K, which is invested moderately aggressively (roughly 80/20 stocks to bonds) and earned just over 10% last year. I can be more risky with this money since I am over 20 years away from retirement. I also have a college savings account and a secondary savings account with a smaller amount of extra $$$ that I’ve invested somewhat aggressively as well (as I can afford a short-term loss with that money as I don’t foresee needing it in the near future.)

So while I’m always interested in a higher interest rate on this savings account, I’m not willing to trade risk for greater return on this money. So no shady oversees accounts for me.

To those talking up currency exchange speculation: I dont think such investment strategies are germaine to the topic. I doubt the blog author would ever recommend any high risk propositions for anything but a very small portion of one’s money, if any at all.

To the “so you’re losing money by investing” comment – I don’t know which post you are responding to, so I will respond simply that earning 1.2% (or whatever) in a interest bearing account may not mean you beat inflation, but it sure beats the alternative, ie earning no return at all

To “way to wealth guy”: savings and frugality moves one in the right direction. No matter what the rate of return, the first thing is to find a way o save, and the more you can save, the faster your advancement towards being “rich”. 5% can absolutely get you there **IF** the underlying saving activity is strong enough. Conversely, if you save nothing, no readily available interest rate will get you there. Also – please point me to the 5% account you are claiming here. I – and most readers here, I’d imagine – would love to earn anything remotely close to 5%, assuming you are staying topical, ie the vehicle in question is a federally insured savings account. So…..ante up, WtWG, or are you just blowing smoke?

Their rates are all less than inflation? So you’re losing money by “investing”?

*shrug*

personally, I’ll stay out of currency speculation and stick with insured accounts, at least with my core personal savings

Does anyone else use Smartypig.com? Their rate is 1.35% right now. It recently went down, but it was originally at 1.75%.

i sampled a few of your posts, and i notice that you don’t include emigrantdirect. is there a reason? i have an account there and consider moving. their rate is so low now only 1%

I did not see smartypig mentioned.

I changed banks three times during last 4 years trying to catch the highest rate, but made a conclusion that I will be better off by choosing one bank with the highest rate and stick with it.
Of course, I will be monitoring the rates, but jumping from one bank to another doesn’t make sense in a long run.

@Bob: About that time, this blog was barraged by folks FROM BANKING ENTITIES trying to act like they were just happy customers and not employees. That kind of behavior came from more than one place, and I don’t recall if the person(s) touting the “wonders” of Shore bank was actually an employee or not. But the message to all reading here is that sometimes the information presented is anything but simply someone’s opinion. Me, I’m retired and was never in the banking industry. I am still happy with ClearSky.

This was entirely predictable. Part of the Chicago political system. When it first came out, there were warning signs that it was not on firm ground, despite a few folks proclaiming it was a wonderful “socially responsible” bank. I think it has been tied to the proposed global warming stuff as an entity that stood to make a lot of money. Sometimes if it looks too good, there is a message there.