High-yield savings account APYs have skyrocketed over the past year as the Federal Reserve has raised the federal funds rate in an attempt to tame inflation. The end result is twofold: higher borrowing costs and higher deposit account APYs. Certificates of deposit (CDs), money market accounts, and high-yield savings accounts have all seen higher-than-normal rates, and for savers looking to supercharge their balances, the time to open an account may be right now.
One of the highest savings account APYs right now: Primis Banks savings account.
Primis Banks current high-yield savings APY: 4.35%
Primis Bank is a tech-first financial institution with all of the security and insurance of a big bank and the digital-first approach of a tech company. It currently offers a personal checking account, savings account, and CDs, as well as business checking and savings options. You can also apply for a mortgage or personal loan through Primis.
The Primis Bank savings account took the #1 spot on our best high-yield savings accounts list for its 4.35% APY (as of Feb. 21, 2023), which is more than 13 times the national average. Whats moresavers can take advantage of this sky-high APY by opening an account with just $1. This savings account doesnt charge any service fees, ATM fees, or incoming wire fees, and there are no transaction limits. Bonus: Interest on your balance is compounded monthly, giving your funds extra opportunities to grow and work for you.
Customers who bank with Primis will also have 24/7 access to representatives via phone, email, and live chat. The downside: This account isnt available for savers who are located in Puerto Rico or other U.S. territories.
Is it worth opening an account with Primis for the APY?
Opening a new savings account solely to benefit from a high APY isnt generally the best idea long-term. The APY on savings accounts is a variable rate, meaning that your APY can increase or decrease without notice at your banks discretion depending on how the economy is doing, changes in the federal funds rate, and several other external factors.
Primis Banks savings account may be a viable option if youre looking for a decent APY and want an account that wont eat into your savings with hidden costs and fees. Primis does have a few offices in the U.S., but unless you live in or around Virginia, youll be doing most of your banking online or via the banks mobile app which has an average rating of 4.3 stars on Google Play and the App Store.
A high APY may be one reason to consider a new savings account, but it shouldnt be the only reason. Before opening a new savings account, its important to think about how that account will help you hit your savings goals and whether the features, fees, and other perks associated with it make sense for you long-term.
Other ways to boost your savings
A high-yield savings account can be an effective tool in boosting your savings, but its not the only way to grow your balance.
- Consider a certificate of deposit (CD): A CD is a type of savings account that offers a high fixed interest rate on a lump-sum deposit for a set period of time. This means that you dont have to worry about fluctuating APYs hurting your savings potential. The catch: Withdrawing your funds before your CD matures at the end of your term will likely result in hefty fees, so this option may only be worth your while if you know you wont need your funds before then.
- Pay down high-interest debt: Carrying large debt balances can seriously impact your ability to save. If you have significant credit card debt, a steep car payment, or a personal loan you havent paid off, it could be worth your while to knock out those balances first so that you can redirect the money used for those monthly payments toward your savings account. Replenishing a savings account typically comes from surplus cash flow, selling an asset, or receiving a bonus or inheritance. Disciplined budgeting as always is the primary goal of any savings plan, says Brian Kuhn, CFP, CLU, CLTC, and a financial adviser at Wealth Enhancement Group.
- Automate your savings strategy: If you do decide to open a new savings account, be sure to automate where you can. Your savings balance will only grow if youre consistent about making contributions to your account. Enroll in auto-pay so that a set amount is deposited into your account from each paycheck. That way, each time you check your account, your balance will likely be a bit more substantial and its one less financial to-do on your list.
The takeaway
When youre working on building your savings account balance, where you choose to park your funds is half the battle. Read the fine print to understand how a potential savings account may help or hurt your ability to hit your savings goals according to your timeline.
EDITORIAL DISCLOSURE: The advice, opinions, or rankings contained in this article are solely those of the Fortune Recommends editorial team. This content has not been reviewed or endorsed by any of our affiliate partners or other third parties.
