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7 Ways to Finally Save More in 2019

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

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The new year is a perfect time to make some changes in your life, whether that’s starting a new workout program or getting a new job. Whatever lifestyle changes you might want to make, don’t forget to include your finances in your new year’s overhaul. Saving more money in 2019 and beyond can help to improve your quality of life along with your other new year’s resolutions.

Here are seven ways to save more in 2019:

#1: Switch to an online savings account

The first (and easiest) thing you can do to save smarter this year is to open an online savings account. Online savings accounts consistently offer high interest rates, especially when compared to traditional brick-and-mortar banks and credit unions. It’s an easy way to set aside money and let it grow much more efficiently than with your local bank.

Let’s say you have $1,000 to stash away in savings. The average savings account APY rate (as of press time) at a brick-and-mortar bank was 0.26%. Without any additional deposits, that would yield a total of $2.60 in savings after a whole year. If you placed that same $1,000 in an online savings account, with the average APY rate of 1.52%, you’d end up with an extra $15.20 in a year.

There are a few drawbacks to online-only savings accounts to be aware of, but they’re pretty easy to get around. Online banks don’t have physical branches where you can seek assistance in person, but they still offer comprehensive customer service.  Many online banks lack access to ATMs, although there are banks that will refund your ATM fees for using a third party ATM or give you access to surcharge-free ATM networks like Allpoint.

If you’re not sure where to start, check out our picks for the Best Online Savings Accounts.

#2: Automate your savings

Whether you switch to an online savings account or not, it’s also best to automate your savings. That way, you’re constantly saving money, even when you’re not thinking about it. This can especially come in handy when you get too busy to pay attention to your savings or in the event you go a little spending crazy. It also helps to budget in these savings as though they were just another necessary expense. That way, it becomes more natural and automatic in your mind as well.

To automate your savings, you simply need to set up automatic and recurring transfers from another account (like your checking account) or your paycheck to your savings account. While monthly payments are typical, you may be able to set the payments to be as frequent (or infrequent) as you’d like. You don’t need to set aside a huge amount each time; perhaps start with $25. Then you can increase the payments with each pay raise or decrease them if necessary.

#3: Explore CDs

When you have enough savings stashed away in a traditional savings account, consider certificates of deposit (CDs) as the next level to saving. Available in a variety of terms, typically from three months to five years, a CD doesn’t come with the flexibility of a standard savings account but can yield higher returns. Once you open a CD and make your initial deposit, you can’t make any withdrawals or additional deposits until the CD’s term is up, known as maturity. This makes CDs a better option for long-term savings goals, like buying a house. You can park your extra savings in the account now, locking in a high rate, and come back to your savings in a few months or years.

Check out our round up of the best CD rates right now >

#4: Open an interest-bearing checking account

Your money grows while sitting in a savings account, so why shouldn’t it do the same in a checking account? Switching your money over to an interest-earning checking account is a smart and easy way to ensure you’re always growing your savings. You shouldn’t expect the high-reaching rates of savings accounts, but you can still earn some extra money over the months. You have plenty of options from both brick-and-mortar banks and online banks. You’ll still find that online banks’ checking accounts offer better rates and much lower fees, though.

#5: Create a $1 or $5 rule

In addition to opening the right accounts, consider adding this more old-school savings approach to your routine. It’s as simple as setting aside the dollar bills, or five dollar bills, that accumulate in your wallet. For starters, this tactic can prevent you from overspending your cash. But it also helps to slowly and steadily grow your savings over time. You can deposit this saved cash into a high-yield savings account at the end of each week, month or year. You could also use it to save it up towards a specific savings goal.

#6: Download handy savings apps

It’s true that there’s an app for just about everything nowadays and saving money is no different. Shopping apps like Ibotta and Ebates are a good place to start. They earn cash back on purchases you make, from your regular groceries to those new headphones you’ve been eyeing. That way, you can earn a little extra cash on money you were going to spend anyway.

You can also start saving little by little with one of the best money saving apps for the long term, Acorns. Acorns links to your bank account and rounds up your purchases to the nearest dollar, taking the spare change and investing it in a personalized portfolio of stocks and bonds. Not only does this set aside some savings automatically, but it allows your savings to grow. It’s also a good way to try your hand at investing if you’re not already familiar.

#7: Add 1% to your 401(k) savings

Saving for retirement should always be a part of your savings goals, and if you have a 401(k), it’s a great way to maintain your savings. The standard rule dictates that you save 10% of your pretax income towards retirement. However, that can be overwhelming and unattainable for many. In that case, it’s okay to start small even if that means saving 1% this year. Then you can boost your contributions by another 1% next year and so on. That way, you continue to save for your retirement in a way that’s more manageable for you and your finances.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lauren Perez
Lauren Perez |

Lauren Perez is a writer at MagnifyMoney. You can email Lauren here

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Robinhood’s Checking and Savings Accounts — Too Good to Be True?

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

The page advertising Robinhood’s short-lived Checking & Savings account was taken down soon after the company faced backlash from the SIPC. (Screenshot/Robinhood)

The no-fee stock trading app, Robinhood, looked poised to disrupt the banking industry last week when it announced a new checking and savings account offering. The company promised an eye-popping 3% APY on both accounts and virtually no fees. But within days of the announcement, the firm’s founders faced pushback from regulators and the future of the accounts were in jeopardy.

Soon after the announcement, it quickly became clear the accounts were nothing like traditional bank accounts at all.

“These are brokerage accounts and not bank accounts,” said Ken Tumin, founder of DepositAccounts.com, a LendingTree-owned site. And, unlike traditional banks, consumers’ deposits would not be covered by FDIC insurance.

But there was nothing to worry about, according to Robinhood’s founders. They assured consumers that the accounts were covered by the Securities Investor Protection Corporation (SIPC). The SIPC is responsible for insuring cash, up to $250,000, meant for investments in the event a firm should go under. So if Robinhood should fail financially, the SIPC could help you recover the money you lost in your Robinhood Investment account. (It cannot, however, protect the losses you might take from bad investments.)

There was just one problem — Robinhood failed to get confirmation that the SIPC would insure its checking and savings products. Stephen Harbeck, President and CEO of SIPC, told Bloomberg he had “serious concerns” about these new accounts, saying Robinhood had not contacted the SIPC before its announcement and that, given the accounts’ nature, they could not be insured by the SIPC as Robinhood had previously claimed.

Under The Securities Investor Protection Act of 1970, which created the SIPC, the organization can protect securities and cash used for the purpose of purchasing securities. Any money in a Robinhood Checking or Savings account would simply sit there earning interest, thus fulfilling neither requirement.

“This raises questions of the legitimacy and trustworthiness of Robinhood and these new accounts,” Tumin told MagnifyMoney.

What this means for Robinhood’s checking and savings accounts

Shortly after Harbeck’s comments were published, Robinhood’s founders backpedaled. Now, there’s no trace of the short-lived Checking & Savings accounts on Robinhood’s website. Instead, you’ll find a section labeled “Cash Management” with a message that it’s “coming soon.” You can still join a waitlist for this account for early access. However, it’s still unclear what this account will offer.

“We realize the announcement may have caused some confusion,” co-founders and co-CEOs Baiju Bhatt and Vlad Tenev said in a statement posted to the website Dec. 14. “As a licensed broker-dealer, we’re highly regulated and take clear communication very seriously. We plan to work closely with regulators as we prepare to launch our cash management program, and we’re revamping our marketing materials, including the name.”

With all this confusion, should you still join the waitlist?

(Screenshot/Robinhood)

Robinhood’s new Checking and Savings products were set to launch in January. Consumers could join a waitlist to get early access to these accounts.

Now that Robinhood’s promise of a high-yield, fee-free account no longer seems feasible, we wouldn’t recommend running to join the waitlist for this account. Clearly, the company still has a lot to figure out.

“I don’t see any compelling reason to join the waitlist,” Tumin told MagnifyMoney. “First, the yield advantage isn’t that great. We already have FDIC-insured online savings accounts with yields between 2.35% and 2.50%. Those will likely be higher in January. Second, if Robinhood and these new accounts are legitimate, these types of accounts will be widely available from both Robinhood and from their competitors.”

Alternatives to Robinhood’s checking and savings accounts

The future of Robinhood’s checking and savings accounts does not look promising. But, as Tumin notes, you still have a number of options for high-yield, FDIC-insured checking and savings accounts. While big banks haven’t raised rates much, online banks continue to offer among the highest rates on savings accounts today. In the last year alone, online banks have raised rates on savings accounts from an average of 0.95% to 1.52%.

Here are a few online savings accounts offering low fees with a high rate.

Vio Bank — 2.37% APY with $100 minimum deposit

A new online bank, Vio Bank is the online division of MidFirst Bank and offers one of the highest savings yields in the industry. You’ll need $100 to open the account, but there’s no monthly fee nor a minimum amount to maintain the account. There is no ATM access with a Vio Bank Online Savings account.

LEARN MORE Secured

on Vio Bank’s secure website

Member FDIC

Ally Bank – 2.00% APY with $0 minimum deposit

A favorite in the online banking world, Ally Bank consistently offers competitive interest rates across all its accounts. Its Online Savings Account earns well above the national average on all balances. You won’t have to worry about a monthly fee on Ally’s accounts, but the bank still makes sure to be transparent about any fees you might face like for returned items or overdraft items.

LEARN MORE Secured

on Ally Bank’s secure website

Member FDIC

Synchrony Bank – 2.20% APY with $0 minimum deposit

Synchrony is another big online bank competitor, currently with a higher rate than Ally. You won’t need a minimum deposit or balance here either. You’ll have free access to any ATM within the Plus or ACCEL networks.

LEARN MORE Secured

on Synchrony Bank’s secure website

Member FDIC

You can check out our full round-up of the Best Online Savings Accounts here.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lauren Perez
Lauren Perez |

Lauren Perez is a writer at MagnifyMoney. You can email Lauren here

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