What Is a High-Yield Savings Account?
A high-yield savings account is an account that offers a more competitive rate of interest than a regular savings account. Determine whether a high-yield account is guaranteed by the U.S. government to protect against loss with advice from a financial consultant in this free video on money management and personal finance.
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Do you have excess cash in your checking or savings account? Have you looked at some of the advertisements in the business magazines that talk about high yield savings accounts? Hi I'm Roger Groh at Groh Asset and today we're here to talk about high yield savings accounts, what they are and how you can use them. These are simply accounts that pay you a more competitive rate of interest or so the marketing says, then you're getting today. Is it really? Who knows, it's marketing hype. Now it doesn't mean you can't take advantage of it. How? Well if you get the Wall Street Journal and look in the back of the Wall Street Journal, money market yields are listed in there and that will give you a broad view. If you want even a bigger view, well look in Bloomberg.com or Reuters.com or you can go to the websites that your stock brokerage firm and type in high yield accounts and see what comes up. You might be surprised because the rate of interest that different institutions paid really does differ significantly. So shop, shop, shop. You can do it online really quickly, go to Bloomberg.com, Reuters.com or even to your own brokerage firm. So shop, shop, shop because remember, yields really do differ. Last but not least, you should also consider whether or not those accounts are guaranteed by the US government, frequently they are not meaning although a savings account can be guaranteed and a checking account may be guaranteed, a high yield account maybe is not. Each one different you have to read the prospectus carefully. Outside the United States the rules are significantly different. Not that yields change, they do, but the guarantees are much different depending upon the country you're in. If you're in the UK or France or Germany, you're probably OK. If you're in China, Malaysia, Thailand or others, well look carefully at where you put your money. I'm Roger Groh at Groh Asset and thank you very much for spending time with me.