Money: Interest Rates and Online Savings Accounts

 Money Pic

Flickr Photo Credit: MarcoPapale.Com

Interest rates can have a dramatic impact on your life, both positively and negatively. If they’re attached to debt you owe, you want them to be as low as possible. When they impact your savings and investments of course, the opposite is true.

If you’re shopping for any sort of rates, loans, CD’s, online savings, etc,  one place we’ve used often is http://www.bankrate.com They’ll let you compare rates for nearly any type of financial product.

Speaking of financial products, we became aware of a new one this past year and are now huge fans. While we had an online savings account with our internet bank, it was not as competitive a rate as we would have liked. We tried putting money into shorter term CD’s and laddering them for extra cash. While this was fine in the beginning, we found that we were coming across investment opportunities with higher rates of return while our money was locked up and out of reach. Then someone turned us on to ING Orange .This company offers no-frills internet savings accounts that link directly to your regular checking. The monthly compound interest rate when we signed up was about 4.5%, higher than we had been making on our CD’s. The money was also still  liquid, allowing us to jump on other short-term, higher return opportunities as they became available.

Now, if financial self discipline is not your thing, you may really want to stick to CD’s or other long-term productsyou can’t touch. But, if you don’t have a proverbial hole in your pocket and want to start branching out from the more traditional investments, a liquid online savings account might just be for you. We’ve been happy with ING Orange, but there are others out there.