There aren’t very many things in life that give you something for nothing, but optimizing the interest rate on your emergency savings fund is one of them. Most traditional bank savings accounts earn less than 0.05% APY, and even if you are like me and have your savings in a money market, chances are high you still stand to gain nearly 1% APY by transferring to an online, high-yield savings account.
The internet has taken some of the power (okay, a tiny teeny weeny sliver) of the power controlled by these large conglomerates and put it into the hands of consumers, which probably explains why Goldman Sachs has knuckled down and decided to offer their high-yield online savings account, Marcus by Goldman Sachs.
For me, the fact that this account offers 2.25% APY, combined with the easy, no-fuss sign up and lack of fees, made transferring our $20,000 emergency fund from the Money Market our local credit union offers to Goldman Sachs an easy choice. The sign up and transfer took ten minutes, and just like that, we are going to earn a cool $450 in interest this year.
Citibank, through their account 2.36% APY account CitiAccelerate, offers another great option, although unlike the Goldman Sachs account, CitiAccelerate requires users to sign up for a banking package that, at a minimum, includes an additional checking account.
If we lived somewhere with a brick and mortar Citibank location, chances are high that account would be enticing enough to change banks for. But I live in Alaska, where there are no brick and mortar Citibanks, so I decided to keep it simple and stick to only opening accounts I know we will use.
There are lots of ways to optimize this even more. If you’re the kind of person who is down to manage 10 different savings accounts, Financial Panther has a great post about slightly more fussy ways to earn up to 5% APY. But I am really, really not that kind of person, and earning 2.25% from Goldman Sachs is still an improvement, and personal finance is personal, and blah blah blah.
*Somewhere, there is a tech guy with an Excel spreadsheet, shaking his head in disgust*
**Also, just in case anyone is wondering, this post contains no affiliate links
***Also ALSO, please feel free to share your high interest savings account ideas below! I am always learning and open to suggestions.