There are a lot of different things that are impacted by the lowering of interest rates. One of the biggest impacts for most people is the interest rate of their bank account. With the Prime Rate so low, the banks are pushing their own interest rates lower as well which means less ability for you to earn money by leaving it parked in an account. These low rates have spawned a huge popularity for high yield savings accounts. While they still provide much better value than many in person banks, unfortunately, the rates for these accounts have also been pushed down recently. What if there was another incentive to open up and use one of these accounts though?
American Express is offering one of those incentives. If you deposit $25,000 into their high yield savings account by July 18th, and keep it there for 90 days, you’ll be eligible for a 25,000 point bonus. If we value the points at 2 cents per point, that would be a value of $500, or a 2% return, Of course, that is on top of the interest you’d earn from the account though.
The interest rates of the account obviously adjusts all of the time. Currently, it’s sitting at 1.15%. That number doesn’t seem high on its own, but it’s actually pretty competitive. Not only are banks offering a fraction of that, but there aren’t too many high yield savings accounts that are offering much higher than that consistently.
As far as the offer is concerned, it’s an interesting one. Earning a bonus of $500 in points isn’t bad at all for bank bonuses. My only issue of course would be tie up $25,000. If you dependent on that for other reasons, then obviously you’d have to wait 90 days to access that money without losing out on the bonus.
Personally, if I had that kind of money lying around, I’d rather invest it in a better way instead of keeping it a high yield savings account. I think there’s probably better ways to get better than a 2% return. However, if $25,000 is chump change to you, and you do want a safe outlet for this money for the next few months, this is definitely the way to go.
Is this an offer you will be participating in? Or is there a better way for you to invest your money? Let us know down in the comment section below.