Want to learn how to earn a higher bank savings interest rate? With inflation picking up post-pandemic, it now takes $3 million if you want to be a real millionaire. Although it’s hard to just save your wealth to wealth, earning as high of a savings interest rate is wise.
How To Earn A Higher Bank Savings Interest Rate
You’ve probably heard about folks with a bunch of credit cards who travel around on free flights using addictive rewards points. If you don’t have much money or have a lot of time on your hands, managing a lot of credit cards that way might be worth it.
I have a minimal number of credit cards, however, because I’d rather focus my time making lots of money online, through side hustles, or through my investments.
That said, I still like to earn free money here and there with little work. Therefore, the best thing everyone can do to raise their bank savings interest rate is through bank rewards!
For example, some online-only banks are offering 0.4%, which is pretty darn good compared to just a couple years ago when money market accounts were paying 0.1% or less. But as the Fed finally hikes interest rates in the next couple of years, expect bank savings interest rates to also rise.
Banks Want More Deposits
I’ve noticed banks are getting hungrier for deposits. Just the other week, I got a couple fliers in the mail from two banks with some great offers.
The first offer is pretty incredible. First Republic is willing to give me $500 if I open up a checking account with only $3,500! All I have to do is maintain a minimum balance of $3,500 for three months and I’m good to go. That’s a 14.2% return.
The second offer isn’t as good, but I still get $500 if I keep $15,000 with a Chase savings account for at least three months and open a checking account as well. That’s a nice 3.3% return in three months, or 13% annualized.
Bank Promos Can = Free Money
If you’re looking for some free money, it’s worth going to various new bank branches and ask if they have any special promotions going on. It’s like a safe way to hack your way to get free money. All you’ll get is a 1099-INT statement at the end of the year for your taxes.
I’ll be using my free $500 to buy me some new overpriced jogging pants as part of the Samurai September, spend more money initiative! Whoo hoo! Sigh, I don’t think I can ever find a way to simply spend money without trying to earn money first.
Most importantly, take this rising interest rate opportunity as motivation to SAVE MORE MONEY. The more you save, the easier it is to achieve financial freedom through passive income.
Financial Freedom Through Investing
I’m currently generating about $300,000 a year in passive income so I don’t have to work a day job anymore. It’s taken me 22 years to get to this level. But once I was able to earn my first $1,000 in annual passive income, I just got motivated to keep going.
Saving money is great. But you need to also invest your money wisely so it can work for you. My favorite investment post-pandemic is in rental properties and real estate in general. The value of hard assets is going up due to inflation. Further, the value of cash flow has gone way up because interest rates have come way down.
Take a look at my two favorite real estate crowdfunding platforms. Both are free to sign up and explore.
Fundrise: A way for accredited and non-accredited investors to diversify into real estate through private eFunds. Fundrise has been around since 2012 and has consistently generated steady returns, no matter what the stock market is doing. For most people, investing in a diversified eREIT is the way to go.
CrowdStreet: A way for accredited investors to invest in individual real estate opportunities mostly in 18-hour cities. 18-hour cities are secondary cities with lower valuations, higher rental yields, and potentially higher growth due to job growth and demographic trends. If you have a lot more capital, you can build you own diversified real estate portfolio.
Manage Your Finances Wisely
Once you have a higher savings interest rate, you should diligently track your net worth. Use a free online financial tool like Personal Capital. Their tools allow you to manage your cash flow, analyze your investments for excessive fees, calculate whether you are on track to retire comfortably, and plan for your future.
That which is measured can be improved. Don’t be like the majority of Americans just winging it with their finances. They’re going to wake up 10 years from now wondering where all their money went! I’ve used their free app since 2012 and have seen my net worth soar.
About the Author:
Sam began investing his own money ever since he opened an online brokerage account in 1995. Sam loved investing so much that he decided to make a career out of investing by spending the next 13 years after college working at two of the leading financial service firms in the world. During this time, Sam received his MBA from UC Berkeley with a focus on finance and real estate.
In 2012, Sam was able to retire at the age of 34 largely due to his investments that now generate roughly $200,000 a year in passive income. He spends time playing tennis, hanging out with family, consulting for leading fintech companies and writing online to help others achieve financial freedom.
FinancialSamurai.com was started in 2009 and is one of the most trusted personal finance sites today with over 1.5 million organic pageviews a month. Financial Samurai has been featured in top publications such as the LA Times, The Chicago Tribune, Bloomberg and The Wall Street Journal.