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Right now, the majority of us are living in this world of vocational uncertainty. Some of us are lucky enough to still be working, but are unsure if that will continue. Some have been unexpectedly furloughed or worse, completely laid off. Others are essential and still working full-time, but are concerned for their health. Whichever camp you belong in, I think we can agree that this is a financially concerning time. Just for kicks, I checked my retirement accounts a few days ago, and the drop I felt in my stomach was similar to that experienced when going down the first hill of a rollercoaster, only without the thrill. Just purely unpleasant.
With that being said, some of us have received or are expecting to receive stimulus checks from the government. If you are like me, you might have recently checked the interest rate on your savings account. Mine was at 1.25% APY in July 2019 and as of today it is down to 0.25% APY. With an interest rate like that and the economy as it is, I’m kind of tempted to just shove the money under my mattress and hope for the best. However, my goal for this post was to try to research the best places to store this money assuming you want to try to earn some interest. I have not considered the stock market in this, as I am completely unqualified to provide any advice there. Also, interest rates appear to change daily in this current environment, so the information provided is subject to change.
Without any further rambling on my part, the following are some ideas to make the most of your stimulus check:
1.) Consider opening a high yield checking account at a Credit Union:
I have mentioned this idea in a different post (How to Start an Emergency Fund by Freeing an Extra $50/Month), but I think it fits here as well. There are many different Credit Unions in each state. They are typically tied to where you live or where you work. I have noticed quite a few have a ‘high yield’ checking option. The requirements for these high interest rates usually include the following: you have to make a certain number of debit transactions a month and there is a maximum balance the rate applies to (portions of the balance above that maximum would get a much smaller interest rate). This can be frustrating, but for us personally, we found it worth the interest rate benefit. We track the number of transactions made in our budget spreadsheet to ensure we meet it every month (think electric bill, gas bill, etc.).
I have read that one of the concerns people have with this idea is that using a debit card to make purchases online is much riskier than using a credit card. My recommendation if you choose this route is to talk to the credit union to understand how they handle fraudulent charges, and also to create eAlerts. These are alerts you can set up for automatic notification, for example if a transaction above a certain value occurs. See below for some of the credit unions I found with good interest rates:
- Genisys Credit Union (Primarily for Michigan residents):
- Checking account interest rate: 4.07% APY (on balances up to $7500)
- Interest rate requirements: min. balance of $1500 (to avoid fee), 10 debit card transactions / month
- Credit union requirements: must live in the state of Michigan or some random counties in Pennsylvania and Minnesota, or be an immediate family member of a Genisys Credit Union member
- Link: https://www.genisyscu.org/accounts/checking/geniuschecking
- Lake Michigan Credit Union (Anyone can be eligible if you make a $5 ALS donation):
- Checking account interest rate: 3.00% APY (on balances up to $15,000)
- Interest rate requirements: no min. balance, 10 debit card transactions / month, at least one direct deposit into account, 4 logins to home banking per month, sign up for eStatements
- Credit union requirements: must live in the lower peninsula of Michigan or Florida or contribute $5 to the ALS Foundation
- Link: https://www.lmcu.org/personal/banking/
2.) If you don’t feel comfortable using a Credit Union, find a bank with a decent interest rate
So we are clear, 0.05% is not a decent interest rate… I looked around and was impressed by the following:
- Capital One 360 Checking and Performance Savings:
- Checking account interest rate: 0.2% APY
- Savings account interest rate: 1.5% APY
- Interest rate requirements: no fees, no minimums
- Link: https://www.capitalone.com/bank/
- Discover Online Savings Account:
- Savings account interest rate: 1.5% APY (this has been a pretty consistent rate for them)
- Interest rate requirements: no fees, no minimums
- Other notes: they sometimes offer extra benefits if you transfer so much money into an online savings account with them
- Link: https://www.discover.com/online-banking/savings-account/
3.) Add to your savings using apps or investigating methods for reducing your spending:
Consider some of my ideas in the previously mentioned post (How to Start an Emergency Fund by Freeing up an Extra $50/Month) and/or some of the additional ideas below:
- Join the survey site 1Q:
- This one will certainly not make you a millionaire, but they give you $0.25 for each question asked. The downside is that there aren’t always a lot of questions asked. The upside though is all you have to do is answer a single question and they deposit the $0.25 directly to your Paypal immediately (no min. balance to cash out). Like I said, you won’t make a ton of money, but for the simplicity, I think it is worth the minimal time it takes up. My referral link is as follows: 1Q.com/w7vxeb
- Try Fetch Rewards:
- This one is similar to Ibotta, but you don’t have to scan specific items, you just have to take pictures of your receipts. Also, they tend to offer extra bonuses (for example right now I have 300 extra points for scanning any receipt) the longer you go without using the app. Last year I earned 24,973 points, which is just short of $25. You can redeem for a number of different gift card options. If you use my referral link below, you will get 2,000 points for capturing your first receipt: https://fetchrewards.onelink.me/vvv3/referralsocial?code=EB4AC
- Join Checkout 51:
- I have been using this app for years now and have so far earned just over $200. Checkout 51 is a grocery rebate app where you can earn cash back for buying certain items and you need to scan the receipt. You have to earn $20 to cash out. When you cash out, you are able to have them send you a check. The offers they have vary, but sometimes they have ‘any brand’ type rewards. For example, right now they give you $0.25 back each on any loaf of bread, bananas, or eggs. Also, if you check Thursday mornings, sometimes they have video ads you can watch to earn $0.10. Once again, you won’t get rich with this app, but it can help with a bit of extra cash back on your groceries. Feel free to use my referral link to join if you are interested: https://checkout51.app.link/GhmJhh5LlX
- Consider MyPoints:
- I joined this site back in 2001. You earn points by doing various things – surveys, visiting websites they send you emails on (Home Depot, Macys, etc.), shopping online, using grocery coupons. I don’t always use this one consistently, but I do typically check the points per dollar spent offered before I shop online. There are other sites that give you cash back from shopping online, so you can always check to see which provides the most benefit. I’ve earned 47,000 points thus far on MyPoints, which equates to about $300. My referral link is as follows if you are interested: https://www.mypoints.com?rb=22662694