Stephen Dybwad

Stephen J. Dybwad | Highly Individualized Financial Guidance

Bank Savings Options

Don't Put Your Money Under the Mattress - There Are Other Options

Insulating your money against inflation, theft, or catastrophe is as simple as taking it out from underneath your mattress and opening a savings account. The three most common are transactional savings accounts, money market accounts, and certificates of deposit. Two alternative accounts are high yield savings and specialty savings accounts. They all operate under the same premise: money given to the bank will earn interest.

Traditional Transactional Savings Accounts

The simplest way to store money with a financial institution is to open a traditional savings account with a small minimum deposit. If the minimum is maintained, the account holder usually avoids fees. Shop around and compare factors like initial deposit and balance requirements, interest rates, and other fees. While being highly liquid makes it easy to withdraw cash and move funds between accounts, they typically have the lowest interest rates. Accounts are federally insured through the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Association (NCUA), protecting your savings from bank failures.

High Yield Savings Account

High yield savings accounts offer interest rates usually 20 to 25 times higher than the national average for transactional savings accounts. While potentially available at your local bank, online banks typically offer the highest interest rates. Electronic transfers between institutions are speedy and straightforward, making it easy to move your funds if needed. FDIC or NCUA also insures them. Keep in mind that banks offering high yield savings accounts do not typically provide checking accounts and other services like ATM cards.

Specialty Savings Account 

Specialty savings accounts are specific to a particular savings goal. These include accounts you can open for children like savings accounts, student accounts, or 529 college savings accounts. Also included are home down payment savings accounts, health savings accounts, and traditional or Roth IRA’s. These accounts generate interest and have either low or no maintenance costs. Be aware of strict and potentially costly regulations related to early withdrawal of funds. There are also specifics concerning who can open what type of account.

Money Market Account

Money market accounts typically offer higher interest rates than traditional savings accounts, .02% higher on average. This type of account is special in that you can write checks and use a debit card, like a checking account. However, there are limits to the amount of money and the number of withdrawals allowed. It’s also not uncommon for higher minimum balance requirements and fees associated with money market accounts.

Certificate of Deposit (CD)


A certificate of deposit, or CD, is an account with a fixed interest rate, term length, and maturity date. The fixed date means funds cannot be accessed early without penalty. These accounts typically pay higher rates than traditional savings accounts and are less liquid. The risk is very low, and the return is guaranteed, making it a safe place to store funds that you plan to use in the future.


Each of these accounts can help achieve your savings goals. Evaluate the pros and cons of each depending on your goals and financial situation. Be sure to explore various institutions for the best rates possible, and as always, consult a trusted financial advisor regarding any questions you may have.

Steve Dybwad picture

Stephen Dybwad

Stephen J. Dybwad | Highly Individualized Financial Guidance

Cincinnati, OH, Louisville, KY, Indianapolis and Madison, IN,

(800) 959-3526

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