Searching for High Interest Rates – What You Should Look For

We are all looking for places to maximize our earnings via the best interest rates possible.  Searching around for the best rates, you can come up with plan like the ones listed here.

Checking accounts with rewards.  Because competition is high in order to try to obtain your business, you can find some local banks and credit unions wanting to attract your business by offering interest rates on checking accounts as high as 5% or more.  The thing to watch for in these accounts is the requirements that they have in order to give you the high rate.You will find that they usually require a high amount as a starting point in the account.  It could be $5,000 or $10,000.  Also, you will probably be required to sign up for direct deposit, use a debit card a specified number of times and get your bank statements online.  If you fail to follow the rules it could cost you most or all of your interest on the account.

Brokered CDs.  These are CDs that are sold by broker and many times pay higher rates that CDs that you will find in other financial institutions.  The amount of your deposit is insured by the FDIC as long as it does not exceed the federal limit which is $250,000 at the moment.  Where you can get hurt is if you find that you need to take the money out before the CD matures.A bank hits you with a forfeiture of some of the interest.  A broker based CD will require that and probably a LOT more.  You could lose all of the interest plus some of the principle as well.  So, only place money into one of these that you are sure that you will not be needing any time soon, or if you do need it, you can wait until the maturity date.

Bank auctions.  There is a new online service that has small and medium-sized banks competing for your business in an Internet auction.  In order to obtain bids, you sign up to a site like www.moneyaisle.com and add a logon account with which you enter a request for bids on the amount that you want to deposit, along with the term of a CD and your state of residence.  Then you will get bids from various institutions that want you to deposit your money with them.  This can also be done with savings accounts as well.  You do not have to be a registered user in order to search for the best rates, either.
If nothing else, this can be a good way to get an idea of what kind of rates are out there so that you can comparison shop in your local area for the best rates.  Is it too bold to suggest that you use this information at your local bank to see if they would be willing to match what you can get elsewhere?  If they turn you down, you will not have lost anything.

Credit Unions.  Already mentioned, Credit Unions not only offer a safe haven for your money, but they often offer some of the best rates as well.  Credit Unions operate under a different philosophy since the members own the bank and customer service is always the highest of priorities.

Local banks.  Some local banks are becoming more aggressive in offering great interest rates on their products.  Stop in and you might be surprised at how far they have come in the competition game.  They realize that their success lies in being able to offer good rates and terms along with their other services.  They like to bundle services together, so look for some great rates if you sign up for other things like a savings account.

Now more than ever, you can earn high rates by performing some research and seeing what is out there.

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This entry was posted on Thursday, May 7th, 2009 at 1:49 am and is filed under Choosing a Credit Card, Financial Advice, Saving Money. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.