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By Matt Richardson

May 9, 2023 / 12:04 PM / CBS News

In today's economy, where millions are still coping with inflation and higher interest rates, where to put your money can be confusing. An investment that seems smart today may not be as valuable in the long run. Stocks can be uneven, and gold typically serves more as a store of value than a way to grow your bottom line.

Fortunately, there are some ways to still safely grow your money. High-yield savings accounts, for example, offer a higher annual percentage yield (APY) than regular savings accounts while still offering depositors all of the same flexibility and options. That said, like almost every other financial product and service, there are better times to open a high-yield savings account than others. To get the most out of such an account, it helps to know the times when a high-yield savings account is worth it.

Explore your high-yield savings account options now to see how much more you could be earning.

Here are three times when a high-yield savings account is worth opening.

The Federal Reserve raised interest rates yet again last week, its tenth such bump since March 2022. The range is now between 5% and 5.25%. Because savings account rates are based on the Federal funds rate, rates on high-yield accounts are heading up again, making now a great time to open one of these accounts. 

This isn't a new phenomenon, however. High-yield accounts have been worth opening throughout the last year as interest rate hikes bumped up the value of these accounts exponentially. Considering you generally earn only 0.39% on a regular savings account (according to the FDIC) and can now potentially earn upwards of 4% with a high-yield account, you'll want to act expeditiously to take advantage.

While the interest rate environment is unlikely to cool off anytime soon, rates on high-yield savings accounts are adjustable, so you're essentially losing money by not transferring some or all of your funds into one of these accounts now. Get started today by exploring some high-rate options.

Certificates of deposit (CDs) are also currently offering high interest rates - and they're locked in for the duration of the CD term. That said, this means you can't access the funds unless you're willing to pay a fee to get them. That setup could quickly become problematic.

High-yield savings accounts don't come with that concern. They function just like regular savings accounts, albeit with higher interest rates and (usually) lower fees. This allows you to continue to meet your banking needs as you always have, providing you with the flexibility you simply won't have with some other deposit vehicles.

Rates on high-yield savings accounts are significantly higher than you can obtain via a regular account. But they're generally even higher if you secure a high-yield account with an online bank. Because online banks don't typically have the maintenance expenses tied to keeping physical branches open, they have more money to pass on to depositors through higher interest rates.

If you already do most of your banking online or are comfortable doing it in the future, a high-yield savings account could be worth it for you. You'll still have access to all of the features you're used to, just online instead of with a teller. And you'll be earning more interest!

Check out your high-yield savings account options here to find the best one for you.

A high-yield savings account has been worth opening for most of the last year or so, if only for the higher interest rates. But it can also be valuable when you need the flexibility a regular account offers (but still want to earn more money). Finally, because online bank typically offer the best rates on these accounts, it can be worth opening when you're already comfortable doing your banking on your desktop or mobile device. 

First published on May 9, 2023 / 12:04 PM

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