$50K in the Bank? Here's When It's Too Much -- and What to Do Instead

Having lots of money in the bank isn't a bad thing. But once you've built up a sizable amount in savings -- say, $50,000 -- it's time to ask: Could some of that cash be better off elsewhere?

Once you've built up an emergency fund (enough to cover three to six months of expenses), keeping additional cash in your savings account means you're missing out on chances to grow your money.

Here's where to move that extra cash instead.

Make more by moving your money

Here are a few great ways to earn more on your extra cash:

• Individual retirement accounts (IRAs): IRAs are the perfect place to save for retirement thanks to their tax advantages -- with an IRA, your money's exempt from capital gains and dividends taxes. They're also super versatile -- you can use them to purchase stocks, bonds, mutual funds, and more.
• Brokerage accounts: Brokerage accounts are another strong, versatile investment option, letting you buy into stocks, bonds, mutual funds, and more. They don't offer the tax breaks of IRAs, but unlike IRAs, they're open to everyone, and you can invest as much as you want. It's the perfect place to grow money that you won't need access to anytime soon.
• Certificates of deposit (CDs): CDs are perfect for short- and medium-term savings. you'll lock up your money for a given term -- months or even years -- and get a fixed APY in return. With interest rates on the decline, now's the perfect time to lock in a high CD rate while you still can.

Opening a brokerage account is one of the best ways to build wealth over time. By investing in an index fund, like one that tracks the S&P 500, you can be confident that your money will grow steadily in the long run.

Ready to start investing? Open one of our favorite brokerage accounts today to get started.

What if you want to hold on to more cash?

There are a few good reasons to keep a lot of cash on hand, like saving up for an upcoming purchase or big medical expense. Beyond that, though, holding $50,000 or more in a savings account isn't the best move.

For any cash you want immediate access to, a high-yield savings account (HYSA) is your best choice. Top HYSAs are currently offering APYs of 3.80% or higher, making them ideal for short-term savings. And just like traditional savings accounts, your money's FDIC-insured up to $250,000.

Here's what I keep in my HYSA:

• Emergency fund: Three to six months' worth of expenses
• Short-term savings: Cash for vacations or large purchases
• Extra cash: Any money you don't need in your checking account

HYSAs aren't suited for long-term investing -- IRAs and brokerage accounts work better for that. For everything else, though, HYSAs are a perfect place to keep your cash.

Want to earn more on your savings today? See our full list of the best high-yield savings accounts available now.