5 Sure Signs You're Using the Wrong Savings Account

A good savings account is a must-have, no matter your financial situation. Everyone needs a safe place to keep their money.

Since savings accounts are such a popular product, there are a ton of options available. It's important to pick one that fits your needs and has competitive features. Otherwise, your account could end up costing you money.

Here are a few signs you're using the wrong savings account.

1. You're earning less than 4%

Savings account rates go up and down. At the time of this writing, the best high-yield savings accounts are offering APYs of 4% or more, and a select few are offering over 5%. On a $10,000 balance, that's $400 to $500 in interest per year!

But the typical savings account earns much less. The average savings account rate is just 0.41%, according to the FDIC. Some of the big brick-and-mortar banks earn even less, with rates as low as 0.01%.

If you don't have a high-yield savings account, you're leaving money on the table. To make the most of your savings, consider the Western Alliance Bank High-Yield Savings Premier. It has a 4.30% APY, one of the highest I've seen recently. Click here to learn more and open an account today.

2. You're paying a monthly fee

Some banks charge a monthly maintenance fee with their checking accounts and savings accounts. You can normally get the fee waived if you meet certain requirements every month, such as maintaining a minimum balance or receiving a minimum number of direct deposits.

It rarely, if ever, makes sense to pay a monthly fee for a savings account. Many fee-free options are available through online banks. If you've been charged a fee for your savings account recently, it's probably time to start looking for a new one.

3. You're struggling to meet the minimum balance requirement

Some savings accounts have a minimum balance requirement, either to have the account or to avoid a monthly fee. This can be challenging if you don't have much saved yet, or if you go through emergency expenses and need to withdraw from your account.

Just like there are many fee-free savings accounts, there are also plenty with no minimum balance requirements. If you're having a hard time maintaining a minimum balance, switch to an account with a $0 minimum.

4. It doesn't have the features you need

Your savings account should make it easy to manage your money. Don't settle for one that's missing features you need.

For example, maybe you want to work toward separate savings goals, such as an emergency fund, a vacation, and a down payment on a home. Many savings accounts have a savings buckets feature, where you can set up separate sub-accounts for different purposes. If you want to keep separate savings goals organized, it's worth having an account with this feature.

5. You don't like the web platform or mobile app

Some banks invest heavily in the online account experience, and it shows. Others seem like they're stuck in 1995, with outdated web platforms and clunky mobile banking apps.

Using your savings account shouldn't be a chore. A quality bank should have a smooth web platform and mobile app, so you can access your savings at home and on the go. If you're dissatisfied with either of these, look for more modern bank accounts.

There's no reason to settle for less with your savings account. If your account is costing you money, or if you're not completely satisfied with it, you have plenty of other options.