Loyalty to your bank doesn’t pay. In this era of online banking, there is no reason to keep all your money in one bank. Even if you live in a small town and use a credit union, online bank accounts at the very least give you leverage over your bank to negotiate higher interest rates, but I would suggest taking some of your money out of that credit union or bank and stash it accordingly:
Discover Checking is the best checking account on the planet. Most checking accounts don’t allow you to accrue interest on your money, or if they do, it’s a very small amount of interest. Discover doesn’t offer interest, either. It offers cashback rewards.
Every time you spend the money in your Discover Checking account you get free money. Every check you write is worth 10 cents in rewards, and you’ll get enough free checks to last you a decade. Every time you use your Discover debit card, you get 10 cents.
Consider you pay every monthly bill with your Discover Checking account: rent, water, energy, credit card and a student loan or car payment. That’s 50 cents. Now consider all of your debit purchases each month. You probably buy groceries and fuel at least once every two weeks. There’s another 20 cents, and if you go out for dinner or entertainment a couple times per month, you’re making at least $1 per month in cashback rewards in lieu of interest. I’ll take that over a miniscule interest rate on my tiny checking account balance.
Oh, and if you ever need cash, you can withdrawal on your Discover Checking account at over 415,000 ATMs and do so for no fee at 60,000 of those ATMs. There’s an even better checking account if you live a mobile lifestyle, though.
The Aspiration Summit Checking account offers an interest rate up to 100 times bigger than the big banks. I get .25 percent APY on my Summit Checking account balance currently, and one percent APY when my balance reaches $2,500. The best part is I never pay an ATM fee no matter where I am in the world. Instead of getting traveler’s checks before going on vacation, you can just open an Aspiration Summit Checking account and use your debit card anywhere.
So those are my recommendations for checking accounts, but where should you keep your savings?
Synchrony is one of three banks that offer 1.2-percent APY on savings accounts (Barclays, Goldman Sachs), but Synchrony comes with easy access to your money, which could be a good thing or bad thing. Regardless, Synchrony offers discounts on hotels and car rentals that Barclays and Goldman Sachs don’t offer.
Since I already have a Discover Checking account, I opened a Discover Savings account as well. It stacks up well against the competition when it comes to its interest rate (1.1 APY), but it makes this list because of its $100 bonus offer. If you make an initial deposit of $15,000 into your new Discover Savings account, you get $100.
For an even better return on your savings, you can open a Wealthfront personal investment or retirement account by answering a few simple questions. Before opening your account, Wealthfront asks you questions about your preferred savings goals. If you want to take more risks for the chance at a better return, you can do that. If you want to preserve as much of your investment as possible, you can do that, too. Wealthfront will invest your money based on your answers to those questions, and they’ll even sell investments that have dipped in value so you can deduct the amount from your taxable income if you enable tax-loss harvesting. That’s why Wealthfront makes the list of 5 best places to keep your money: ease of use. You can open the account and never check it again until it’s time to collect.
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