High-yield savings acct

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miyaraj354
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High-yield savings acct

Post by miyaraj354 »

Hi all,

My DW overheard a conversation between two people discussing a certain high-yield savings acct that gives back @ 13%!! But also, there is a investment cap of $10k. Anyone knows what that is?
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retired@50
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Re: High-yield savings acct

Post by retired@50 »

miyaraj354 wrote: Mon Mar 20, 2023 11:07 pm Hi all,

My DW overheard a conversation between two people discussing a certain high-yield savings acct that gives back @ 13%!! But also, there is a investment cap of $10k. Anyone knows what that is?
I have no idea, but I know this much, if regular money market funds are paying around 4.5%, then anything paying 13% has RISK, and plenty of it.

Be careful, and let us know if you find out. The forum members will go over the prospectus with a fine tooth comb.

Regards,
If liberty means anything at all it means the right to tell people what they do not want to hear. -George Orwell
strummer6969
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Re: High-yield savings acct

Post by strummer6969 »

The only thing I can think of is I-Bonds which had a yield of 9.62% last year. They do have a $10,000 cap.
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Svensk Anga
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Re: High-yield savings acct

Post by Svensk Anga »

strummer6969 wrote: Mon Mar 20, 2023 11:21 pm The only thing I can think of is I-Bonds which had a yield of 9.62% last year. They do have a $10,000 cap.
That 9.62% was the variable rate. You would add to that the fixed rate, which varies according to when the bond was issued. For bonds issued at the peak fixed rate in the six months starting May 2000, that was 3.6%. These bonds got a composite rate of 13.39% for six months. See the column under 522, 4.81% fixed rate here: https://eyebonds.info/ibonds/rates.html
gotoparks
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Re: High-yield savings acct

Post by gotoparks »

It's not mainstream.
z3r0c00l
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Re: High-yield savings acct

Post by z3r0c00l »

miyaraj354 wrote: Mon Mar 20, 2023 11:07 pm Hi all,

My DW overheard a conversation between two people discussing a certain high-yield savings acct that gives back @ 13%!! But also, there is a investment cap of $10k. Anyone knows what that is?
Not a chance, they were probably confused or just making the number up. Scammy annuities and other similar investments sometimes offer "up to 12% APY" or something similar. That just means they might make that much but almost certainly won't.

One says: "Turn direct exposure to USA-based oil and gas investments into IRA-eligible returns of up to 12% APY with P____ today. No banks. No middlemen. No volatility."

If you are seeing a number much over 5% right now, it is too good to be true.
70% Global Stocks / 30% Bonds
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retired@50
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Re: High-yield savings acct

Post by retired@50 »

Svensk Anga wrote: Tue Mar 21, 2023 8:48 am
strummer6969 wrote: Mon Mar 20, 2023 11:21 pm The only thing I can think of is I-Bonds which had a yield of 9.62% last year. They do have a $10,000 cap.
That 9.62% was the variable rate. You would add to that the fixed rate, which varies according to when the bond was issued. For bonds issued at the peak fixed rate in the six months starting May 2000, that was 3.6%. These bonds got a composite rate of 13.39% for six months. See the column under 522, 4.81% fixed rate here: https://eyebonds.info/ibonds/rates.html
Great. Does anyone have a time machine so we can all go back to the year 2000 and buy an I-bond?

For the lucky few who did, and held the bond, I guess I'd say it's serving its purpose. Trying mightily to keep up with inflation.

Regards,
If liberty means anything at all it means the right to tell people what they do not want to hear. -George Orwell
H-Town
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Re: High-yield savings acct

Post by H-Town »

miyaraj354 wrote: Mon Mar 20, 2023 11:07 pm Hi all,

My DW overheard a conversation between two people discussing a certain high-yield savings acct that gives back @ 13%!! But also, there is a investment cap of $10k. Anyone knows what that is?
Yes, I also have a bridge I can sell to you.
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Doctor Rhythm
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Re: High-yield savings acct

Post by Doctor Rhythm »

It’s often said that you shouldn’t make investment decisions based on chats at the water cooler, a YouTube video, or a friend’s hot tip. I absolutely agree, but I would do any of these before I made a decision based on someone else’s recollection of a partially overheard conversation between people they didn’t know well enough to ask for details.
cjcerny
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Re: High-yield savings acct

Post by cjcerny »

miyaraj354 wrote: Mon Mar 20, 2023 11:07 pm Hi all,

My DW overheard a conversation between two people discussing a certain high-yield savings acct that gives back @ 13%!! But also, there is a investment cap of $10k. Anyone knows what that is?
Yes, it is called a Ponzi scheme. :)
Samosa22
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Re: High-yield savings acct

Post by Samosa22 »

These kind of opportunities exist and they are as safe as any FDIC/NCUA insured bank/credit union. However, usually the catch is that (1) one has to complete a bunch of extra steps to qualify for the higher APY, (2) there is a cap on the balance earning an unusually high APY, (3) one cannot earn the same high APY for years, (4) deals are geographically restricted, and so on and so forth.

Case in point, Gesa credit union is currently offering 7% APY on balances upto $5k PLUS $350 signup bonus....so the total APY turns out to be 14%, but only for the first $5k and for the first year! https://www.doctorofcredit.com/id-wa-or ... p-to-5000/

So, a couple can open two separate accounts and earn 14% APY on a total of $10k, but only for the first year (and even 1 year is not guaranteed since they can reduce the 7% APY anytime they wish).
Diversification is protection against ignorance - WB.
strummer6969
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Re: High-yield savings acct

Post by strummer6969 »

Svensk Anga wrote: Tue Mar 21, 2023 8:48 am
strummer6969 wrote: Mon Mar 20, 2023 11:21 pm The only thing I can think of is I-Bonds which had a yield of 9.62% last year. They do have a $10,000 cap.
That 9.62% was the variable rate. You would add to that the fixed rate, which varies according to when the bond was issued. For bonds issued at the peak fixed rate in the six months starting May 2000, that was 3.6%. These bonds got a composite rate of 13.39% for six months. See the column under 522, 4.81% fixed rate here: https://eyebonds.info/ibonds/rates.html
Yeah, I bet that's what they were talking about. I would be all over them with a 3.6% fixed rate now...
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miyaraj354
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Re: High-yield savings acct

Post by miyaraj354 »

Thank you, all, for the replies. I definitely did not take the bait but was curious.
DonIce
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Re: High-yield savings acct

Post by DonIce »

There's all kinds of small/local banks/credit unions and such that will offer rewards/premium checking accounts that pay outsized interest rates on the first few thousand dollars you hold with them (in some cases up to $10k) if you jump through a ton of hoops like doing x number of debit transactions, direct deposits, credit card transactions using their CC, etc etc. Keep in mind that an extra few % on a few thousand dollars just amounts to a small annual bonus in exchange for doing all/most of your business with that bank (to satisfy the requirements).

For example here's some random credit union that pays 10% on the first $1500 if you do a bunch of stuff: https://www.bridgecu.org/diamond-dividends/
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