8 Low-Risk Ways To Earn More Interest On Your Money | Bankrate (2024)

A smart personal finance strategy often involves earning some interest on your money while not taking on too much risk. These days, high-yield savings accounts are one viable option, as some are outpacing inflation due to the Federal Reserve raising its benchmark interest rate to a 23-year high.

In addition to savings accounts, there are plenty of other relatively safe ways to get a return on your funds, whether it’s through rewards, bonuses or stable investments.

In all, here are eight low-risk strategies to consider.

1. Switch to a high-interest savings account

Some banks offer special, high-interest savings accounts that earn better rates than traditional accounts.

One of the best places to look for high-interest savings accounts is an online-only bank. Online banks, which save significant costs by not having to maintain branches, rarely charge monthly fees. They also typically offer rates that are much higher than those paid by traditional banks.

The best high-yield savings accounts currently earn an annual percentage yield (APY) of 5.35 percent. This is around 10 times the Bankrate national average rate of 0.58 percent on March 25, 2024.

Based on these two rates, if you deposited $5,000 into one account that earns the top yield and another that earns the national average, here’s approximately what it would have earned in interest after one year:

  • Interest on an account that earns 5.35 percent APY: $275
  • Interest on an account that earns 0.58 percent APY: $29

You’d earn around $246 more by going with the high-yield savings account. Bankrate’s savings account interest calculator is a tool that allows you to plug in dollar amounts, rates of return and timeframes to determine how much your savings can earn.

Best Savings AccountsCompare today's top Savings accountsCaret RightBest CD RatesCompare today's top CD ratesCaret Right

2. Consider a rewards checking account

Some banks offer rewards checking accounts, which may earn cash back on things you buy with your debit card. Those who make frequent purchases using a debit card would benefit the most from this type of checking account.

Other rewards checking accounts pay higher interest rates, although the balance that earns the elevated rate is often limited. You may also need to jump through some hoops to earn the bonus rate.

For example, Consumers Credit Union (CCU) offers interest rates as high as 5 percent APY on balances of up to $10,000 for its Rewards Checking account. However, to earn that yield, you’ll need to meet all the following requirements:

  • Sign up for electronic statements
  • Make at least 12 debit card purchases per month
  • Receive an aggregate of $500 or more during the statement cycle in direct deposits, mobile check deposits or ACH credits to the account
  • Spend $1,000 or more in CCU Visa credit card purchases per month

If you choose to use a rewards checking account, make sure that the requirements to earn the elevated interest rate are easy for you to meet. Otherwise, you might earn less interest than you would with a standard savings account.

3. Consider certificates of deposit

Certificates of deposit (CDs) typically offer higher interest rates than traditional savings accounts. However, there’s less flexibility to withdraw your money from a CD.

When you put funds into a CD, you have to agree to leave the money in the account for a set period of time, called the term. For example, if you open a one-year CD, you have to leave the money in the account for a full year. If you withdraw your deposit before the term expires, you are subject to an early withdrawal penalty.

One benefit of CDs is that you lock in the interest rate when you open the CD. Even if market rates drop, you’ll keep earning the same rate. On the other hand, if rates rise, you’ll be stuck earning the lower rate until the CD matures.

Once the CD term ends, you can withdraw your money or roll it into a new CD. If you roll the balance into a new CD, you have to wait for that CD to mature before having another opportunity to make a penalty-free withdrawal.

4. Build a CD ladder

CD ladders combine the higher rates of CDs with some of the flexibility of savings accounts.

Laddering CDs involves opening multiple ones with staggered maturity dates. For example, you could open a one-year CD each month for a year, and then one will mature each month the following year. Bankrate’s CD ladder calculator can help you build a CD ladder that’s right for you.

In this example, instead of locking up all of your money in a single one-year CD, you can get access to portions of it at regular monthly intervals and avoid having to pay a penalty for early withdrawals in the event you need your money.

How you structure your CD ladder depends on how much flexibility you’re willing to sacrifice for higher yields and how frequently you want to have access to your funds. For example, a five-year CD ladder would include the purchase of five CDs with different terms: a one-year CD, a two-year CD, a three-year CD, a four-year CD and a five-year CD. This way, one of your five CDs would be maturing every year — and when each CD matures, you could reinvest the funds into another high-yielding CD.

5. Take advantage of bank bonuses

Many banks offer introductory bonuses for new customers who sign up for an account and meet a few requirements. Usually, checking account bonuses require you to set up regular direct deposits and make a minimum number of transactions each statement period.

For people with some savings already set aside, bank account bonuses can be an easy way to increase your earnings. These bonuses typically ask new customers to deposit a minimum amount to the account and keep it there for a certain period of time. In short, you could boost your savings balance by opening a new account and funding it with savings held at another bank.

For example, you might see a bonus offering $300 if you deposit $10,000 and maintain that balance in the account for at least three months. Earning such a bonus would be equivalent to earning a 3 percent APY in a savings account for a year (assuming the APY didn’t fluctuate and you didn’t add money to the account or withdraw from it).

Even larger bonuses of $400 and $500 are available from some banks, although higher minimum deposits are usually required to earn those.

Be sure to read all the fine print. Some banks will charge a fee if you don’t meet certain requirements or try to close the account too quickly after opening it. Some banks might even make you forfeit the reward if you close the account soon after getting the bonus.

6. Try a money market account

Money market accounts offer a mixture of the features found in savings and checking accounts. They pay interest, sometimes at higher rates than high-yield savings accounts, while commonly offering check-writing privileges and debit cards that you can use to make withdrawals, with some restrictions.

The drawback of money market accounts is that they may have higher fees and minimum balance requirements than savings accounts. There’s also no guarantee that your bank’s money market account pays a better rate than its savings account.

7. Check with your local credit union

Unlike banks, credit unions are not-for-profit financial institutions owned by the people who hold accounts there. This means credit unions work for the benefit of account holders instead of shareholders.

In some cases, that can translate into lower fees, better account perks and higher interest rates. If you have a credit union near you, check the rates it offers, as you might be able to get a good deal.

If you don’t live near any credit unions and tend not to do any of your banking in person, consider a credit union that allows you to apply and perform all of your banking transactions online.

While some credit unions are relatively easy for anyone to join, others are only open to people who live in a certain region or work in a given industry.

8. Consider buying government bonds

If you don’t mind a little risk or restriction on your withdrawals, you can put your money into bonds instead of a traditional savings account.

Buying a bond is like making a loan to the company or government that issues it. When the bond matures, you get your principal back plus any interest you earn. You can buy U.S. Savings or Treasury bonds, or bonds issued by major companies. Each has different interest rates and repayment terms, with riskier bonds tending to offer higher rates. Typically, yields are higher on bonds with longer terms and corporate bonds that have higher default risk.

One thing to keep in mind with bonds is that they can drop in value if market rates increase. (The price of a bond moves inverse to its interest rate.) As a result, if you wind up selling your bond to someone else before it matures, you might have to sell it for less than you paid. Still, bonds are far less risky than stocks, making them a good way to increase the yield your savings earns while taking a little more risk.

With the rate of inflation running higher than usual, many bond investors have turned to Series I bonds. As inflation increases, the interest rate on these bonds rises along with it, which ensures your money doesn’t lose purchasing power over time. Likewise, however, the interest rate on these bonds also decreases when inflation goes down.

Earning higher interest: Which option is right for you?

Each of these options has the potential to increase the amount of interest your savings earns. But which interest-bearing option is right for you depends on your needs, risk tolerance, and the effort you’re willing to put in. Ask yourself these questions:

Will I possibly need quick access to the money? If you’re working to build up an emergency fund, your best bet is often to stick with a high-yield savings account where you can withdraw the money anytime without a penalty.

Rather, if you’re saving for the planned purchase of a house in several years, a CD that pays a competitive yield can be a good investment. Another option for money not needed in the near term can be higher-yielding bonds, which are likely worth holding onto until after they mature.

How much debt do I have? If you already have an adequate emergency fund, consider focusing on paying down any high-interest debt before devoting additional funds to other investments.

Am I able to make the required commitment? Sometimes, a bit of effort and attention to detail are needed. For instance, bank bonuses can be very lucrative, but they often require you to take multiple steps to earn the bonus.

Take some time to think about which of these strategies is right for you.

Bottom line

Earning interest in a low-risk way is often possible through vehicles such as a high-yield savings account, money market account, CD, bonds and bank bonuses. These relatively safe strategies can help you boost interest earnings while shielding you from more volatile investments that may exceed your risk tolerance.

8 Low-Risk Ways To Earn More Interest On Your Money | Bankrate (2024)


8 Low-Risk Ways To Earn More Interest On Your Money | Bankrate? ›

As of April 2024, no banks are offering 7% interest rates on savings accounts. Two credit unions have high-interest checking accounts: Landmark Credit Union Premium Checking with 7.50% APY and OnPath Credit Union High Yield Checking with 7.00% APY.

Where can I get 7 interest on my money? ›

As of April 2024, no banks are offering 7% interest rates on savings accounts. Two credit unions have high-interest checking accounts: Landmark Credit Union Premium Checking with 7.50% APY and OnPath Credit Union High Yield Checking with 7.00% APY.

How do you get 12 interest on your money? ›

1 The best way to earn 12% interest on your savings is by investing in a high-yield savings account. High-yield savings accounts are offered by some banks and credit unions and generally offer higher interest rates than traditional savings accounts.

Where can I get 10 percent interest on my money? ›

Where can I get 10 percent return on investment?
  • Invest in stocks for the short term. ...
  • Real estate. ...
  • Investing in fine art. ...
  • Starting your own business. ...
  • Investing in wine. ...
  • Peer-to-peer lending. ...
  • Invest in REITs. ...
  • Invest in gold, silver, and other precious metals.

What is the best way to save and earn interest? ›

What is the best way to earn interest on your savings?
  1. Instant-access savings accounts usually have the lowest interest rates due to their liquidity.
  2. Individual savings accounts (ISAs) offer tax-efficient earnings on interest.
  3. Fixed-term and regular savings accounts typically offer a high amount of interest.
Mar 14, 2024

Who has the highest paying CD right now? ›

Featured Nationally Available CD and Savings Rates
Account NameAPY (Annual Percentage Yield) Accurate as of 4/23/2024Minimum Account Opening Balance
Alliant 1 Year CD5.15%$1,000
Western Alliance Bank 3 Month CD5.26%$1
Barclays 6 Month Online CD5.00%$0
SkyOne Federal Credit Union 1 Year No Penalty CD4.75%$1
6 more rows
1 day ago

Which bank pays 7% interest on savings accounts? ›

Existing-customer regular savers – what we'd go for
ProviderRate (AER)Can you skip months?
Co-operative Bank7% variable for one yearYes
Skipton BS (must have been a member since before 11 Jan 2024)7% fixed for one yearYes
Coventry BS (must have been a member since 1 Jan 2023)6.75%Yes
Nationwide6.5% variable for one yearYes
13 more rows
Mar 22, 2024

How to make money double? ›

The classic approach of doubling your money by investing in a diversified portfolio of stocks and bonds is probably the one that applies to most investors. Investing to double your money can be done safely over several years, but for those who are impatient, there's more of a risk of losing most or all of their money.

How can I make money in hours? ›

Here are a few ways you can potentially earn extra cash in just one hour.
  1. Sell the old stuff. You know that old stuff you've got lying around, collecting dust? ...
  2. Share your opinion. ...
  3. Quick freelance tasks. ...
  4. Write away. ...
  5. Be a virtual assistant. ...
  6. Social media promotion. ...
  7. Food delivery. ...
  8. Package delivery.
Feb 23, 2024

Can I double my money in 5 years? ›

As a rate of return, long-term mutual funds can offer rates between 12% and 15% per year. With these mutual funds, it may take between 5 and 6 years to double your money.

What is the safest investment with the highest return? ›

Here are the best low-risk investments in April 2024:
  • High-yield savings accounts.
  • Money market funds.
  • Short-term certificates of deposit.
  • Series I savings bonds.
  • Treasury bills, notes, bonds and TIPS.
  • Corporate bonds.
  • Dividend-paying stocks.
  • Preferred stocks.
Apr 1, 2024

What is the safest investment? ›

Safe assets such as U.S. Treasury securities, high-yield savings accounts, money market funds, and certain types of bonds and annuities offer a lower risk investment option for those prioritizing capital preservation and steady, albeit generally lower, returns.

Where can I put my money to draw the most interest? ›

  • Certificates of deposit (CDs) typically offer higher interest rates than traditional savings accounts. ...
  • CD ladders combine the higher rates of CDs with some of the flexibility of savings accounts.
  • Money market accounts offer a mixture of the features found in savings and checking accounts.
Apr 2, 2024

What is the best thing to do with a lump sum of money? ›

Upon receiving a lump sum, the immediate question is where to store it. A savings account is a common choice, offering a secure place to keep your money while earning some interest. There are several types of savings accounts designed to cater to different needs and goals.

How do most people make money? ›

Most Americans earn their incomes from wages and salaries. To earn their daily and yearly bread, they go to work at job-sites and offices. But the rich are different; they get big parts of their incomes from business profits and capital gains.

How can I Maximise my money? ›

How to maximise your savings
  1. Look into switching banks and take advantage of sign-up offers. ...
  2. Consider investing when saving for the long-term. ...
  3. Make the most of the tax benefits of ISAs. ...
  4. Consider a financial product with a government bonus. ...
  5. Leave your money saved or invested for longer.

Can you get 7% on a CD? ›

Can You Get a 7% CD Account? There was a lot of excitement in August 2023 about a few credit unions offering 7% APYs on certificates. But those rates were offered for a limited time only and are no longer available. However, the nation's best CD rates are still well above 5%, with some pushing toward 6%.

What bank offers 8% interest? ›

Nationwide launched its market-leading 8% regular saver on 21 September 2023, which followed on from its previous flex issue offering 4.5% AER back in October 2022. The account permitted you to save between £1 and £200 per month, and unlike a lot of other regular savers, this one required no minimum monthly payment.

Where can I earn 6% interest on my money? ›

These 6% Checking Accounts Are Available Nationwide
  • Pelican State Credit Union - 6.05% APY on balances up to $10,000. ...
  • Credit Union of New Jersey - 6.00% APY on balances up to $25,000. ...
  • Fitness Bank - 6.00% APY on balances up to $25,000. ...
  • Orion Federal Credit Union - 6.00% APY on balances up to $10,000.
Oct 20, 2023

Where can you earn 6% interest? ›

Digital Federal Credit Union has an account that pays over 6% APY, but you must meet membership requirements to get started. You also won't earn this high interest rate on your entire Digital FCU savings balance. Plenty of savings accounts are available around the U.S. and still offer great rates — over 5% APY.

Top Articles
Latest Posts
Article information

Author: Sen. Ignacio Ratke

Last Updated:

Views: 5616

Rating: 4.6 / 5 (76 voted)

Reviews: 91% of readers found this page helpful

Author information

Name: Sen. Ignacio Ratke

Birthday: 1999-05-27

Address: Apt. 171 8116 Bailey Via, Roberthaven, GA 58289

Phone: +2585395768220

Job: Lead Liaison

Hobby: Lockpicking, LARPing, Lego building, Lapidary, Macrame, Book restoration, Bodybuilding

Introduction: My name is Sen. Ignacio Ratke, I am a adventurous, zealous, outstanding, agreeable, precious, excited, gifted person who loves writing and wants to share my knowledge and understanding with you.