Updated: Sep 17
Are you getting the most from your bank? Over the last decade or more, there hasn't been much banks could do for the average person trying to grow their wealth. Interest rates on typical savings, money market, and CDs have been dismal at best. Most turned to the stock market or real estate as their best bet to increase their wealth. But as always, the stock market comes with its own risks, and real estate opportunities can be limited without significant capital.
Now, as the sun sets on an exceptional period of low-cost lending and stock market volatility increases, many are searching for the best way to maximize the return on their money. By today's conditions, there is more value in choosing the right bank, minimizing any bank charges or fees, and leveraging your savings nest egg than ever before. Keep reading for our tips on getting the most of your banking situation in 2023.
What makes one bank a better fit for your money over others?
Everyone's opinion of what makes a bank great will vary based on their needs and what they value most. It used to be that small-town friendliness and customer service ruled supreme. With the transition to digital banking, many of our priorities and expectations have shifted. Access to digital payment networks like Zelle, free money transfers, auto-draft protection, credit score access, exclusive savings offers, and budgeting tools are just a few of the basic services we've come to expect from a 'good' bank. Some others standards we need to make sure our bank upholds are no monthly or transaction-based service fees. The whole point of a bank should be to help its customers keep their money safe, be more fiscally responsible and help them grow their wealth when possible not nickel and dime them for regular conveniences. Below we've listed a few common areas your current bank may be costing you and that you will want to check when considering any new bank.
A few policies to check before switching to any bank
Make sure your new bank is offering a full suite of industry-standard services without any common catches. Rank the following in order of importance to you and compare across all banks you're considering.
Balance minimums and monthly service fees
Availability of Free checks
Complimentary overdraft protection
Daily money transfer limits
Branch and ATM location convenience
FDIC Member status
Once you've put together your list of priorities and non-negotiables it's time to see what the market has to offer.
Why It's Important to Shop Your Banking Every Year
If you’ve been at your bank for two years or more, it’s time to consider your options. As a valued customer, your bank should be offering you the best products they have available. But sometimes they're more eager to attract new customers than retain existing ones. That is when it's time to do what's most financially prudent for you, shop around. Please note the next section contains referral links to products I use personally and recommend. I am not contracted to promote these products by their respective companies.
Maximizing Money: Two Ways to Boost Your Savings Now
Compound interest is your best friend when it comes to building wealth. Reaping the benefits of compound interest in a low-risk and low-maintenance way is easiest with a simple high-yield savings account.
Left untouched a modest nest egg of 10k will net over $300 in a year at a 3% interest rate. That's $300 for doing nothing and just letting your money work for you. The best part is you could earn even more interest by continuing to make monthly contributions to your savings throughout the year.
Use this free APY interest calculator to put together your savings budget and watch the money pile up.
Our High Yield-Savings Recommendation:
CIT Bank - 4.05 APY with $100 minimum (offer per the writing of this article)
Other Industry Expert High-Yield Savings Recommendations:
Not all experts evaluate products the same way. Though considered reliable resources some of these experts may be paid for their endorsements. Make sure to cross-reference and compare what criteria they use when recommending each bank and make the decision that best suits you.
Receive a Generous Special Offer to Switch Banks Now
Though transferring banks can be challenging, it's well worth the time for the bonus. Many banks are running aggressive promotional offers to attract new clients. You could net yourself a couple of hundred dollars in bonus money just for making the switch and meeting a couple of qualifications. It could be the most profitable 15 minutes of your year.
To help make the transition smoother, download our simple checklist to ensure all your automatic payments and deposits are managed accordingly.
Our Checking account Bonus Offer Recommendation:
Chase Total Checking recieve $200 for setting up a new checking account with direct deposit (offer per the writing of this article, this is my personal referral link I may be rewarded by Chase for new eligible accounts opened at no cost to you)
Other Industry Expert Banking Bonus Offer Recommendations:
Not all experts evaluate products the same way. Though considered reliable resources some of these experts may be paid for their endorsements.
Make sure to cross-reference and compare what criteria they use when recommending each bank and make the decision that best suits you.
Conclusion on Maximizing your Banking
Though interest rate hikes aren't great if you're looking to make a large purchase like a new home or vehicle they are great for those trying to nurture their nest egg. A quick search online and it's easy to find high-yield savings accounts offering interest APY's nearing 5%. We haven't seen interest rates like this since the early aughts. Pair these great interest rates with competitive offers from banks seeking new account holders and you could have a very profitable and fiscally prudent start to your new year. But before you make any moves make sure that your bank or banks meet the service standards and don't come with any unsavory policies as discussed above.
For the core of your banking, you'll want to shop for two things, each without fees or limitations. The most competitive interest rate, and or the largest incentive for transferring banks altogether. Wishing you and yours a productive and profitable 2023.