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61 votes

Why would I ever put my money into a savings account that returns less than the current inflation rate?

Why? Because the two are unrelated. "Inflation rate" is calculated by measuring changes in the consumer price index (CPI). Your personal consumption may not match the CPI and the inflation you ...
Pete B.'s user avatar
  • 77.2k
61 votes

Transfer over $10k

However, I heard that government monitors transfers of over $10K No this is wrong. They want to know about cash or cash equivalent transactions over 10K, or small cash or cash equivalent transactions ...
mhoran_psprep's user avatar
58 votes
Accepted

Short term parking of a large inheritance?

"Safe short term" and "pay almost nothing" go hand in hand. Anything that is safe for the short term will not pay much in interest/appreciation. If you don't know what to do, putting it in a savings ...
BrenBarn's user avatar
  • 24k
46 votes
Accepted

How to manage expenditure when billing cycles and paycheck cycles are not aligned?

It sounds like the problem is that when your husband got paid twice a month, his paycheck was large enough to cover the bills in full so you were able to pay them right away, then you could use the ...
lizziv's user avatar
  • 1,746
40 votes
Accepted

Is it a good practice to keep salary account and savings account separate?

This seems like a risky setup. All it takes is one missed or delayed transfer for you to overdraw your "savings". There is a benefit to keeping your regular expenses and savings separate, and I can ...
D Stanley's user avatar
  • 139k
36 votes

How to manage expenditure when billing cycles and paycheck cycles are not aligned?

The ideal state is one in which it doesn't matter when either of you get paid. Where you use last month's income to pay this month's expenses. The starting place is a simple budget. You know when ...
Hart CO's user avatar
  • 70.6k
32 votes
Accepted

Who does the money go to if "everyone" in a family dies?

TL;DR State keeps everything. What exactly happens largely depends on the particular state's probate laws. These laws are notoriously complicated and vary greatly between the states. In very rough ...
default locale's user avatar
31 votes

Why should I not keep my checking account at $0 and use overdraft protection?

There are several issues with this plan. The financial institution may limit the number of free overdrafts they allow. After that they charge a fee. When they cover a check/debit card transaction ...
mhoran_psprep's user avatar
29 votes

How much money should I lock up in my savings account?

Firstly well done on building a really sold base of savings. An emergency fund needs to have two key characteristics: Be enough to get you through a typical emergency event (often seen as approx. ~6 ...
Philip's user avatar
  • 5,768
27 votes

Why would I ever put my money into a savings account that returns less than the current inflation rate?

You keep money in a savings account so that you know you can access it at any point, and that it will always be there. It is diversification of risk. If you have the money in equities instead, you ...
Magua's user avatar
  • 5,097
25 votes

Does a savings/checking account sitting at $0 have any drawbacks?

The main concern I'd have is that something will happen to the account while it's unattended. While you may not have any money in it to risk, you could have a fraudulent check written against it that ...
Joe's user avatar
  • 35.9k
25 votes

Are demand and time deposit accounts really loans _to_ the bank?

Yes. When you deposit a sum of money into a bank account, that account is an asset for you. At the same time, it is a liability for the bank. Let's say that you are depositing $1000 to your bank ...
Ben Miller's user avatar
  • 116k
23 votes
Accepted

What's up with banks closing down their high yield savings accounts and incentives lately?

Generally high yield savings accounts are used by banks to increase the deposit base. The banks are required to keep a certain ratio of loans outstanding to deposits in the bank, and paying high ...
littleadv's user avatar
  • 178k
20 votes

Short term parking of a large inheritance?

I am sorry for your loss, this person blessed you greatly. For now I would put it in a savings account. I'd use a high yield account like EverBank or Personal Savings from Amex. There are others ...
Pete B.'s user avatar
  • 77.2k
20 votes

When to stop saving and start investing?

Given your specific situation, being debt free and in Germany where there are supportive social structures in place for potential unemployment etc, I would consider the following: Depending on your ...
Leon's user avatar
  • 4,107
20 votes

Will closing a checking/saving account have a bad effect on my credit report?

I want to know will this has a bad effect on my credit, etc? Closing a checking and/or savings account should have zero impact on your credit score. There is a risk if you close the account, and you ...
mhoran_psprep's user avatar
20 votes

How are the banks behind high yield savings accounts able to pay such high rates?

How are the banks behind high yield savings accounts able to pay such high rates? Where does their yield come from? The money deposited in the checking accounts, savings accounts, high yield accounts,...
mhoran_psprep's user avatar
17 votes

How are the banks behind high yield savings accounts able to pay such high rates?

Since we are currently coming out of a zero-interest-rate regime you may be wondering how the bank can make money offering 4% on a savings account while getting 2% on the loans it made last year. The ...
Stack Exchange Supports Israel's user avatar
16 votes

Why should I not keep my checking account at $0 and use overdraft protection?

Aside from the other answers, which are very good, there is this. Your savings account likely gains interest at a ridiculously small rate, less than 1%. Unless you have many thousands of dollars in ...
nuggethead's user avatar
  • 2,099
13 votes

What is the purpose of "Regulation D"

Let's divide all bank accounts into savings and checking. The main difference is that checking is easy to get money from; savings is hard to get money from. Because of this, the federal Reserve ...
mhoran_psprep's user avatar
12 votes

Savings account versus corporate bond

The bond will rank below depositors, so it's riskier than the savings account. The savings account is very safe if you have less than £75,000 in accounts with the bank, as then it would be covered ...
GS - Apologise to Monica's user avatar
12 votes
Accepted

When making an online money transfer, why is one often asked whether the source account is checking or savings?

why one is often asked whether the source account is checking or savings? Some of this is legacy. Once upon a time Account Number were repeating for Savings and Checking [as well as Currency]. Hence ...
Dheer's user avatar
  • 57.1k
12 votes

When to stop saving and start investing?

Here's the general order of things: Keep 3-6 months of expenses in a savings account for emergencies (lose your job, car accident, mauled by dingos, etc.) Pay down all your debt as fast as possible. ...
GraphicsMuncher's user avatar
12 votes
Accepted

Is there any benefit to keeping money in a checking account?

You said, Whenever I see things like this, they are always tied to moving money from your checking to your savings account. The reason why that's the mechanism they're suggesting is because most ...
dwizum's user avatar
  • 17k
12 votes

SwissGap savings platform, is it legit or scam?

Telling you an investment earns 5% per month = scam. No other discussion necessary. Nothing earns that much without being gambling or a lie.
Grade 'Eh' Bacon's user avatar
12 votes

What is the advantage of a Sparbuch, and how does this work?

This is probably mainly for historical reasons. When I was young (born '87 ;) ) and we still had positive interest rates, this was really common. Every child had one and on world savings day one ...
Manziel's user avatar
  • 7,442
12 votes

pending recession: keep money in 401k or savings account?

You are asking whether you should withdraw money from your 401k because you are concerned about economic downturn which might cause your investments to decline in value. No. You should not. The reason ...
Matthew's user avatar
  • 3,150
10 votes
Accepted

Why do sole proprietors in India generally use a current account?

No. Current account is not a requirement. You can use savings account. You would need to pay taxes on interest. Savings account have limitation on number of withdrawal in a quarter, hence most sole ...
Dheer's user avatar
  • 57.1k
10 votes

Why would I ever put my money into a savings account that returns less than the current inflation rate?

Any store of value has some risk of being outpaced by inflation, as measured by some other asset. For instance, you might invest in property, but find that the cost of a loaf of bread has gone up ...
IMSoP's user avatar
  • 960
10 votes

Why should I not keep my checking account at $0 and use overdraft protection?

I know I once got warned about drawing from my savings account too many times within a certain amount of time (maybe four times in a month and a fifth would have triggered a fee). If you have similar ...
Dave's user avatar
  • 829

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