Here's Why You Need To Open a High-Yield Savings Account in 2024

As we near the end of 2023, you may be thinking about your financial goals for the upcoming year. For those wanting to save more money, now is the ideal time to put a plan in place to make your goals happen. If you're going to work hard to save more money, you should keep your extra cash in a bank account that earns interest. If you don't yet have a high-yield savings account, you may want to open one before 2024 begins. 

Your checking account isn't the best place for your savings

Many people have a checking account they use regularly. While this is an excellent place to store money for everyday expenses like your electric bill and mortgage loan payment, you don't want to keep your extra savings here. Why? Most checking accounts don't earn interest -- so you won't get rewarded for stashing your emergency fund here. 

Instead, you'll want to keep your savings in a bank account that pays interest. Before opening a new savings account, you should review the annual percentage yield (APY). Opening a bank account with a higher APY can allow you to earn more interest. As you continue to earn money from interest, your bank account balance will grow.  

Earn more interest with a high-yield savings account 

Some banks have savings accounts with meager APYs. But many online banks offer high-yield savings accounts with generous APYs, which allows you to earn more money from interest. For this reason, it can be beneficial to open a high-yield savings account.

Are you wondering how much more interest you could earn by opening one of the best high-yield savings accounts? Let's imagine you already have $5,000 saved. The following example shows the total interest earned after one year with a regular savings account with a 0.01% APY vs a high-yield savings account with a 4.50% APY. The difference is shocking.

As you can see, it's important to pay attention to a bank account's APY. If you are going to work on your savings goals next year, you may want to consider opening a high-yield savings account in the coming weeks so you're ready to earn as much interest as possible. 

Do this to stay on top of your savings goals

When life gets busy, it's easy to become forgetful. If you want to avoid forgetting to save money in the new year, you can automate your savings. Doing this will also save you time. You can log into your online bank account and set up automatic contributions. Once you do this, money will be transferred from your checking account to your high-yield savings account as often as you'd like. It's an easy solution to ensure you prioritize your savings goals. 

Consider these high-yield savings accounts 

Ready to get saving? Here are three high-yield savings accounts that are worth considering: 

Capital One 360 Performance Savings: This account has a 3.60% APY, no deposit minimums, no maintenance fees, and no minimum balance requirements. Read our full Capital One 360 Performance Savings review to learn more about the benefits of this account. 

Act now: Open a Capital One 360 Performance Savings account now.

Western Alliance Bank High-Yield Savings Premier: This high-yield savings account has a 4.30% APY, a $1 minimum balance requirement, and no account opening fees or maintenance fees. You can read our full Western Alliance Bank High-Yield Savings Premier review to learn more. 

Act now: Open a Western Alliance Bank High-Yield Savings Premier now.

Achieve your financial goals in 2024 

As we finish the final weeks of 2023, make sure you carve out some time to outline your personal finance goals for the year ahead. You can set yourself up for success before we ring in the new year. Don't miss out on the chance to boost your bank account balance by earning interest as you save.