4 Low-Risk Ways to Earn Higher Interest
Are you tired of earning next to little interest on the money you’re saving in your bank account? Jeremy Keil shared 4 low-risk options to earn higher interest in our recent conversation on The Struggle is Real. Here is a recap:
Bankrate.com
Open up a high-yield savings account. If you’re unsure where to start, Bankrate.com posts a monthly summary of the highest yielding savings accounts. Here is the January summary.
One thing to be aware of is some banks will do a short-term incentive then drop their rates soon after. If you want a trusted industry favorite, check out Ally.
MaxMyInterest
MaxMyInterst is a more hands-off approach by moving your money to different bank accounts with the best interest rates on your behalf. There is a fee for this service, but it may be worth it if you want to earn the highest interest rate without having to do all the research yourself.
Membership in maxmyinterest.com costs just 0.04% per quarter, or $40 per $100,000 held in your savings accounts, subject to a minimum of $20 every 3 months.
I-Bonds
I Bond rates are determined by a combination of a fixed rate, which is set by the Treasury Department, and an inflation rate, which is based on the Consumer Price Index (CPI) and changes every six months.
You’ll want to be aware that I Bonds have certain rules, and penalties if broken. We discuss a lot of the specifics with Jeremy Keil in Episode 81.
Treasury Bills
Banks often invest in T-bills as part of their operations. When you put your money in a savings account, the bank is essentially borrowing your money and using it to invest in T-bills, among other things. By investing in T-bills directly, you can cut out the bank as the middleman and potentially earn a higher interest rate.
T-bills are generally considered to be a very safe investment, as they are backed by the US government. You can buy T-bills directly from the government through the TreasuryDirect.
Overall, these options are low-risk, low-return investments suitable for people who want to invest their money for a short period of time or avoid the risk that comes with alternative investments.
If you need help deciding which option might be best for your situation, check out our discussion with Jeremy Keil on The Struggle is Real.
