I bonds vs High Yield savings account
Good morning,
can you tell me the difference between a High Yield savings account and the I Bonds you have been talking about. Which one would be better to invest in? I have about $70,000.00 to invest.
thank you.
Terry Says
Well, I don’t know what YOU mean by a “high yield savings account.” Beware, because that “high-yield” may turn out to be uninsured or a scam. You can find the highest yielding savings or money market accounts at Bankrate.com. If you want easy access to your money, then you have to stick with short-term CDs or a money market fund at an FDIC insured bank. And those rate are only about one-half of 1% these days.
Read this article about I-bonds. The rates may drop in the future. And you must hold them for at least 5 years or face a penalty loss of 3 months interest if you withdraw early. So maybe some I-bonds and some money market funds, depending on when you will need to use this money. They are equally safe.
