How to Get Higher Interest Rate for Your Deposit in USA

A perennial question in the minds of all investors is “How can I get a higher return than I am currently making?” And that is quite fair as everyone has a right to a better future and brighter prospects. Becoming satisfied with one’s situation is almost certainly the killer blow to one’s aspirations towards success. To pursue that argument, most people who have deposited their money in the money market would certainly know that the rates at the moment are not that high. Therefore, they would almost certainly be looking for other avenues to invest in to maximize their return for the least possible amount of risk. And if you are one of those people, you would be thinking along the same lines. However, do not fear and do not go anywhere else. You do not need to invest in another product. Stay in the money market, but invest in alternative instruments. Read on to get a better idea.

By 401(K) 2012 under CC BY-SA 2.0

CHECKING ACCOUNTS:

This is known to the majority of the people as this is the default account people get for daily transactions. This is also referred to as current account. These types of accounts usually offer an unlimited number of transactions but do not generally pay a decent interest rate.

SAVINGS ACCOUNTS:

These are a very basic type of deposit accounts aimed at earning an interest, which is usually good for the younger people or people with very little balance. The interest rates on these are also generally lower. While the transaction limit is less than 6 transactions per month, crossing which the owner of the account is charged is free.

CERTIFICATES OF DEPOSIT (CDS):

If you are seeking the highest possible interest rate on your deposit, this is the type of account you need to look into. Certificates of deposit have the highest interest rates possible. Which is further affected by the amount and the time period you are willing to leave you money untouched. The longer you leave it, the higher will be the interest rate you earn.

How to look for the best interest rates on your deposit.

1. Do not go for the first bank you see, ask around, contact friends and family, do some research, the interest rate on any bank is bound to change from time to time. Barclays is one of the best choices with an interest rate of 0.90% APY.
2. Estimate the differences in different types of accounts. Only you know the amount you are planning on depositing, so only you can decide the best account for yourself. It’s always best to go for Certificate of Deposit with the maximum offered length of time. Barclays offer 2.5% interest rate for a 5 yr CD while Ally Bank offers 1.6% for the same period.
3. Don’t just glance through the terms and conditions, but read each line carefully, ask for assistance, if needed. Most saving accounts have a requirement of minimum balance, and they limit the transactions you can make while CDs have hefty fee attached if you withdraw before it matures.

By Boris Dzhingarov