The amount that $100,000 would make in a high yield savings account would be between $4,200.00 to $5,000.00 in interest per year if your high yield savings account has an APY of between 4.2% to 5%, although the earnings may fluctuate with market rates.
If your APY on your high yield savings account is 4.2% then you would earn around $4,200.00 annually on the $100,000.00 in the high yield savings account.
At 4.5% APY you would earn around $4,500.00 annually on the $100,000.00 in high yield savings.
And with an APY of 5.0% you would earn roughly $5,000.00 annually with $100,0000.00 high yield savings.
If you put $50,000.00 in a high yield savings account you will earn around $2,000.00 to $3,000.00 and sometimes more annually depending on the interest or APY Annual Percentage Yield.
If the high yield savings account has an APY of 4.20% then you would earn $2,100.00 in the first year of having $50,000.00 in the high yield savings account at 4.50% APY you would earn around $2,250.00 in interest in the first year and at 4.0% APY you would earn around $2,500.00 in interest in the first year.
High yield savings accounts are very safe as high yield savings accounts are FDIC insured like other savings accounts and checking accounts up to $250,000.00 per depositor, per institution.
The FDIC insurance for the high yield savings account protects your principal and money up to $250,000.00 even if the bank fails, just like it would do with traditional savings accounts.
High yield savings accounts have better interest than normal savings accounts and without market risks, which makes them great for emergency funds.
However the interest rates with high yield savings accounts can also change and unlike stocks, high yield savings accounts are not subject to market volatility so your balance remains stable and funds are also easily accessible for emergencies, although some banks may limit transactions.
You are allowed to take money out of a high yield savings account as high yield savings accounts are designed for liquidity.
Although you should also be aware of any potential monthly withdrawal limits which is often around 6 monthly withdrawals, which is set by the bank, and you can incur fees or account issues if the monthly withdrawal limit is exceeded on the high yield savings accounts.
You can access and withdraw the money from your high yield savings account through checks and debit cards for some high yield savings accounts or through an ATM card or electronic transfers.
Electronic transfers are the most common way of taking money out of high yield savings accounts that is linked to your checking through ACH transfer.
Federal regulations also used to limit savings withdrawals to 6 per month and while that rule is now relaxed, many banks still impose their own withdrawal limits which is often around 6 and might charge a fee or fees or convert your account if you exceed the withdrawal limits.
Transfers from high yield savings accounts is not always instant and can take a couple of business days for the money to become available in your linked account.
High Yield Savings accounts offer great liquidity, which makes them ideal for emergency funds or for short term goals, unlike CDs in which early withdrawals incur penalties.
Opening a high-yield savings account does not affect your credit score because the high-yield savings account is a deposit account and not a loan and so opening the high-yield savings account is not reported to the credit bureaus.
However when you do open a high-yield savings account a soft inquiry may be placed on your credit report, which is harmless though and will not lower or affect your credit score.
Although poor management of the high-yield savings account could result in harm to your credit score.
But when used properly the high-yield savings account won't hurt your credit score as you're saving money using the high-yield savings account and not borrowing money, so it does not show up on your credit report as any debt.
The banks though usually run a soft pull on your credit report when opening up a high-yield savings account to verify your identity, which does not impact your credit score.
And savings activity including on high-yield savings accounts are not listed on your standard credit reports like TransUnion, Equifax and Experian.
Having the savings account and savings in the high-yield savings account reduces the need for other loans, credit cards etc for emergencies, and prevents missed payments or high credit utilization which would hurt your credit score.
The highest yielding savings accounts offer Annual Percentage Yields (APYs) around 4.20% to 4.35%, with some potentially reaching up to 5.00% with specific conditions like direct deposits, though these rates fluctuate and depend on the bank and account requirements.
Top contenders for high yield savings account to consider include Newtek Bank, Peak Bank, Openbank, and potentially Varo Bank, but always check for minimum balances, direct deposit requirements, and withdrawal limits when comparing options.