Apple’s new high yield savings account has caused a few head turns as it announced the launch of an FDIC high yield savings account backed by Goldman Sachs. A high yield savings account is a type of bank account that pays you more money in interest than a regular savings account. Before you go online and apply, below are 3 things to consider:
1. Decide what to do with the interest earned
Let’s say you have $10,000 that you want to save. If you put that money in a high yield savings account that pays 4.15% in interest, you will earn $415 in interest after one year.
Once you’ve earned this interest, you have a few options to consider. You could choose to do nothing and let the interest continue to compound, which means you’ll earn even more interest over time. Alternatively, if you’re a fan of Apple products, you might consider using the interest you’ve earned to buy something like Apple Air Pods or an older generation Apple Watch. $415 could be enough to purchase one of these items, and it’s a great way to treat yourself while still being responsible with your money.
2. Apple Card (credit card) Requirement to Open Account
When things sound too good to be true, it’s because they are. There will be strings attached, according to the Apple Goldman Sachs Deposit Agreement, one of the requirements is you have to be an “Owner or Co-Owner of an Apple Card”. The Apple Card does not carry a low interest rate either, according to the Apple Card Customer Agreement the Annual Percentage Rate (APR) varies from 15.74% to 26.74%. Opening a credit card seems painless but then comes the temptation to use it.
3. High Yield Savings Accounts with no Strings Attached
Discover, Ally Bank, Marcus, and Capitol One offer High Yield Savings accounts with yields slightly lower than Apple with no requirement to open a credit card. You may want to consider one of these online banks before opening an account with Apple if you are not inclined to open a new credit card.