What is a high-yield savings account?

A high-yield savings account is a type of savings account that typically offers a higher interest rate compared to traditional savings accounts. These accounts are offered by online banks or financial institutions and are a popular choice for individuals looking to grow their savings while still having easy access to their funds.

Some key features of high-yield savings accounts include:

1. Higher interest rates: High-yield savings accounts offer higher interest rates compared to traditional savings accounts, allowing your savings to grow at a faster rate.

2. No monthly fees: Many high-yield savings accounts do not have monthly maintenance fees, making them a cost-effective option for savers.

3. No minimum balance requirement: Some high-yield savings accounts do not require a minimum balance to open or maintain the account, making them accessible to a wide range of savers.

4. FDIC insurance: Like traditional savings accounts, high-yield savings accounts are typically insured by the Federal Deposit Insurance Corporation (FDIC) up to the maximum allowable limit, providing added security for your savings.

5. Online access: High-yield savings accounts are often offered by online banks, meaning you can manage your account, deposit, and withdraw funds online or through a mobile app.

Overall, a high-yield savings account can be a smart choice for individuals looking to earn a competitive rate of interest on their savings while still having easy access to their funds. It's important to compare rates and features of different high-yield savings accounts to find the best option for your financial goals.