Business_news Ally vs. Marcus vs. Wealthfront: How 3 of the most popular high-yield savings accounts stack up

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  • High-yield savingsaccounts can help you earn up to 20 times more interest on money you need in the short term, while still keeping it safe and accessible.
  • Dozens of banks offerhigh-yield savingsaccounts, but we compared three of the most popular:Ally’s online savings account, Goldman Sachs’ Marcus account, andWealthfront’s cash account.
  • With no monthly service fees, competitive interest rates, and low or no minimum deposit to open, you really can’t go wrong with any of thesehigh-yield savingsaccounts.
  • It’s important to remember thatinterest rates fluctuate. It’s fine to choose the account with the highest rate today, but be sure it meets your other needs as well.
  • See business Insider’s picks for the best high-yield savings accounts »

Just because the Federal Reserve hascut interest ratesdoesn’t mean it’s a bad time tosave money.

Whether you’re building up anemergency fundorsaving for a down paymenton a house (or both), a high-yield savings account can be a great tool for getting closer to those goals.

There’s no downside to having a high-yield savings account — it grows the money you’re stashing away for a rainy day or a big purchase, while keeping it accessible and safe. But because so many banks offer them, it may seem difficult to choose the one that’s right for you. Here’s the good news: You really can’t go wrong.

High-yield savings accounts are attractive for their competitive rates. Even when the Fed’s benchmark rate fluctuates, these accounts tend to earn up to 20 times more than a traditional savings account, and 200 times more than your typical checking account.

Dozens of banks have high-yield savings accounts and it may come down to where you prefer to bank — an online-only bank, an investment bank, or arobo-advisor, for example — as well as what you’re looking for, whether it’s minimal fees, the highest possible interest rate, the ability to transfer money whenever you want, a connected checking account, 24/7 customer service, or easy access to your account.

To help out, we compared three of the most popular high-yield savings accounts on offer today:Ally’s online savings account, a favorite amongfinancial plannersand super savers; Marcus, investment bank Goldman Sachs’ online savings account; and robo-advisorWealthfront’s cash account.

Below you’ll find each of these high-yield savings accounts compared on a variety of metrics.

 AllyMarcusWealthfront
Type of financial institutionOnline bankInvestment bankBanking service
Annual percentage yield (APY)1.25%1.30% APY0.35% APY
Minimum opening deposit$0$0$1
Service fees$0$0$0
Debit card or checksNoNoDebit card
Transfer or withdrawal limit6/month6/monthNone
Excess transfer charge$10N/AN/A
Mobile appYesYesYes
FDIC insurance coverage amount$250,000$250,000$1 million
Checking account availableYesNoAccount has checking features
Customer service24/7 by phone, email, or chatBy phone only; M-F 8 a.m.-10 p.m. ET, Sat.-Sun. 9 a.m.-7 p.m. ET24/7 by email; unspecified phone hours

You may notice the interest rates vary among these accounts. As mentioned before,interest rates on savings accounts fluctuatedepending on inflation and the Government’s interest-rate benchmark.

Choosing the account with the highest interest rate today is a fine decision, but know that the rate offered when you open the account isn’t locked in. In short, ensure the account is otherwise desirable — it has low fees, for example — before parking your savings there.

Across the board, high-yield savings accounts offer better rates than a traditional savings account — hence: high-yield — so you’ve already made progress towardautomatically building wealthby keeping your money there, regardless of how the rate shifts over time.

The bottom line: Many of us make the mistake of being paralyzed by indecision when it comes to money. Not saving because we don’t know how much to save, not investing because we can’t figure out thebestway to invest, or losing money to fees and inflation because we won’t choose a better bank account — I’ve been there and chances are you have, too. Don’t let that hinder you from building wealth.

As financial expert and bestselling authorRamit Sethiputs it, “The single most important factor to getting rich is getting started, not being the smartest person in the room.” Choose an account with little fees and high earning potential, Sethi says, and move on.

Personal Finance Insider offers tools and calculators to help you make smart decisions with your money. We do not give investment advice or encourage you to buy or sell stocks or other financial products. What you decide to do with your money is up to you. If you take action based on one of the recommendations listed in the calculator, we get a small share of the revenue from our commerce partners.

Take control of your money.SmartAsset’s free tool matches you with a financial planner in your area in 5 minutes.Learn more »

Disclosure: This post is brought to you by the Personal Finance Insider team. We occasionally highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. What you decide to do with your money is up to you. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team.

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Ally vs. Marcus vs. Wealthfront
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