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🚨The High Yield Savings Account TRAP 😳📉
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- Опубліковано 9 бер 2023
- High yield savings account 4% interest may actually stop you from earning much more with stocks, dividend stocks, and ETFs. Best investing tips during a down market as stocks can raise much higher so think long term!
#highyieldsavingsaccount #etfinvesting #dividendinvesting
*not financial advice
Yes but parking your emergency fund in a high yield savings account is a smart move l
Definitely agree!
Agreed. I’m only parking my emergency fund into that high yield savings account.
The rest is investing!!!
@@NolanGouveiawhat’s the best high yield savings account to use for storing money ?
Yeah thats where I just wanna keep like 5000, or so for emergencys
For people not knowing what to do in markets
So its not a "trap". Youre just not gaining on the upside by investing in stocks or an etf. Hard to call something a trap when u still receive 5% with minimum to no risk
@bikmeemee4474how do you do it? Genuinely inquiring
@bikmeemee4474because there are risks involved into what you do. Not with the hysa as it is insured up to 250k
@bikmeemee4474 we all have jobs that Ernest thousands and thousands a week. We don’t have time to stare at a screen all day trading stocks. I have about $150,000 a year of expenses for my business. I lose everything if I do not have, the money on hand for my business. If I put it into a stock, sure I could get it out… 90% of the time. But I’m 100% of the time kind of guy, that’s why at 4.95% savings account is an excellent option for that money.
@bikmeemee4474what stocks are good
@bikmeemee4474 Are you using stop loses? If not be careful.
Maybe people do it because... IDK.
The money is insured. And we can't all afford to gamble it away on the stock market. 🤔
Yup
Yeah facts this is for the MLM get rich quick guys. Not the blue collar guys working for every damn dollar every damn day. 😂
@@dreahdickinson9602Change your reality
Stock market is not gambling, tf?
My dumb ass had 30k in Chase saving for years not gaining interest, i finally opened a HYSA and dumped most of it in Capital One 360 saving at 4.35%APY...i chose CO over others with 5% or higher because CO has branches near me and a convenience if i ever have to pull money out. I may also put some money in their CDs for the higher APYs
Good call ya I chose CO for similar reasons
Same bro
@homerlvlup also wanna add CO'S app is fantastic. It tells you everything about your account in detail including your daily compound interest. I already gained $55 interest since I opened my account in January. Also opened a CO Savor One CC for $200 cashback on $500 and over purchase within 3 months and cashback on many other purchases. CO is pretty great right now.
I heard Marcus by Goldman Sachs gives 5.40%, has anyone tried it?
Started putting $20 a month in CO. My checking account is linked online so if needed I can just transfer over.
The whole point of a high yield savings account mine is 5% is that you can access the money whenever you want like now if I had to pay for an emergency of course have money else where aka a portfolio but do not have your savings in the stock market like if you trying to save up for a house o shit house market dropped 10% interest rates got lower also omg this is the house I want o shit stock market is down 50%
I don't think this is very good advice. Some accounts are paying close to 5% right now and not taking advantage of free money is foolish. I trade stocks and see good people get flushed out all the time because they try and catch a falling knife. Wealthy people can take risk and gamble because at a certain level of wealth money has doesn't have the same value.
Exactly. Can put into money market account and HSA account up to 5.20% now. Safe and can take out anything so it is liquid. Much better than losing money in the market especially in a volatile market that goes up and down. Take advantage of these high interest rates that won't last forever. Makes a lot of sense for people nearing retirement who can't play this gambling game and just want to make some free money. 5% is nothing to sneeze at if you have a lot of funds . For young people I would say park the money in the market is the better route but this advice isn't for everybody. This one size fits all advice is dangerous for those who can't take the risks and have the time to recoup their money back like younger investors.
Buy low -- sell high.
Clicks “Don’t recommend this channel anymore”
✌️
Fr. Clickbait. Calls it a trap, but really just explains that you wouldnt profit as much as the bank would. But still smart and minimal risk
I agree with this don’t recommend this channel
High Yield Savings Account is not a CD
CD’s have similar interest rates as HYS but you are required to lock your money for a minimum 1 year and require a penalty if you open it up.
High Yield Savings does not do that.
He never said it was a CD.
@@alexanderkempf9828Yes he did .
@@alexanderkempf9828 He said they lock your account for at least a year or longer which is not true. You can take your money out at anytime from High Yield Savings account. HSA is just like a regular savings account just with better returns.
@@brandonozoria4371 do you understand English grammar? If I say, "A hippo (or lion) can kill you on a safari", that doesn't mean I am saying that a hippo is a lion.
CITBank has 6 month CD's at 5%.
THIS IS NOT WHAT BANKS DO!
This is blatant misinformation
Can you elaborate more? I'd love to learn why
@@nobodyelse7911 i believe that banks cannot use depositors money for taking risky investments (i.e. buying undervalued tech stocks). They can invest specific portion in specific asset classes. For example government securities which are pretty much the safest option available.
but there is a point in the video, that over the long horizon, stocks may overperform any savings account ... just not for the reasons mentioned in the video
@@nobodyelse7911Banks don't make their money by investing in stocks etc. Contrary to popular believe banks are (usually) quite risk averse, especially after many regulations were put in place after the financial crisis. In simple terms, banks make by giving you 2% on your deposit while lending out your money for 4%.
@@nobodyelse7911I’m not an expert but I believe the banks use the money to issue other loans to other people at a higher interest rate. For instance, they pay you 3-5% interest on the money you have saved but then used the money to issue loans to other people at let’s say 15-20% interest. If you decide to pull your money out of savings they still have enough money to pay you because there are a lot of other people with money sitting in their savings. But if everyone who banks there went to pull their savings out at once they bank wouldn’t have enough money to cover it because they’ve already lent out a portion of the money.
so if I need money right away will I be able to take it out from the ETF without a penalty fee?
Depends which account the ETF is in. If it is a non-retirement account you don’t pay a penalty fee but you will pay capital gains tax.
While stock dividends are typically not taxed until the shares are sold, cash dividends are considered taxable income by the IRS. How they're taxed, however, depends on whether they're qualified or nonqualified: Qualified dividends, which have been issued by a U.S.-traded company to shareholders who have owned the stock for more than 60 days, are subject to capital gains tax rate.
All other dividends are considered nonqualified and are subject to standard income tax rates.
If you receive more than $10 in dividends, your brokerage will send you a 1099-DIV form with relevant information for completing your tax returns.
-CNBC
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I understand the fact that tomorrow isn't promised to anyone, but investing today is a hard thing to do for me now because I have no idea of how and where to invest in.l would be happy if you could advise me based on how you went about yours, as I am ready to go the passive income path.?
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I agree that you can make a higher return but your pocket watching mentality doesn’t make sense.
By your logic, you shouldn’t have gone to chipotle because… why are you going to fund the owners Lamborghini? 😂
By the way big banks loan your money, CHARGE YOU to use your own money and make millions on stupid fees such as over drafts.
It’s a no brainer to use a hysa, unless you need a physical location. Ask yourself, when’s the last time I’ve visited my bank in person? If the answer is over a year. Then it’s time to switch.
Why can't you do all of that, put your money in high yield savings and invest in solid ETFs and companies? That high yield savings account sure beats the hell out of the .015% offered by banks like Chase.
Agree!
Capital one has great saving account options.
@neyquam I have an account with them, but I went over to Bread Savings which is currently at 4.7% and Vio Bank whose money market savings is at 5% at the moment
Capone is great have their 5% 11month CD..
@@SeismicSalesis having CD from Capital One better than their HYSA?
you can park your money in a high yield savings account until you find a good investment opportunity!!! REITS! or for an emergency
Banks usually don’t invest in stocks like you’re explaining. That’s way too risky for them, all they do the majority of the time is lend that money at 1-2 points higher than the APY you’re earning. Not that large of a spread like you described
Please don’t make shorts just for the sake of making it
Ok
You're still getting that 3-4 percent increase when you weren't gonna spend it anyway. Yes the banks use it, but you still have the amount you put in. That's how all banks work even with debit cards
It’s still smart to keep at least some of it in savings and a CD. Because if the entire market heads south, and you’re all in on it when a depression or another recession hits, guess what you’re completely broke in a newly bearish economy. 💯
It's not a trap..just because they are using your money to increase their profits you are using them to increase yours..dont get me wrong, there are other ways to make better profits such as buying low selling high as you suggest BUT trap is not the correct word
Good point!
Tangerine is not pushing anything but con artistry... for the second time now they have made a false product. Namely their savings accounts. Where they lure people to transfer money into their "savings plan" this time with the PROMISE of 6% interest until Jan 31, 2024. first month they said .. oh the 9$ you received for the 10k inputted to the account was justified because it was put in, in installments throughout the month. By Oct 1st, 2023 there was 14k in there. The 6% payment was less than 0.5% payment at a wopping grand total of .... $52!!!!!!!!!!!!!!, these crooks and all their employees, hate families and use lies and the protection from their parent bank Scotial Bank, to commit these crimes. It is imperative that you understand how evil these people are. Right down to the customer service that doesn't exist.. STAY SAFE AND STAY FAR AWAY FROM TANGERINE.!!
Nov 2023, what good indexes are down 15-20% right now?
CD and high yield saving account are not the same.
CD requires you to keep your money in the account for certain period of time
High yield saving accounts allow you to withdraw money anytime you want/need to
I mean you’re literally getting 3-5% for not knowing anything. Sounds decent to me.
This is misleading. Its not a trap. They're going to operate this way whether they have your money or not. Park your long term cash savings in a CD and earn 4%. THEN take on this guys risky strategy of picking your own stocks at your discretion. Tool in the toolbox not a trap.
Time in the market NOT timing the market.
I don’t have the money to throwaway when stocks drop like they do. Idk what to do.
Tangerine is not pushing anything but con artistry... for the second time now they have made a false product. Namely their savings accounts. Where they lure people to transfer money into their "savings plan" this time with the PROMISE of 6% interest until Jan 31, 2024. first month they said .. oh the 9$ you received for the 10k inputted to the account was justified because it was put in, in installments throughout the month. By Oct 1st, 2023 there was 14k in there. The 6% payment was less than 0.5% payment at a wopping grand total of .... $52!!!!!!!!!!!!!!, these crooks and all their employees, hate families and use lies and the protection from their parent bank Scotial Bank, to commit these crimes. It is imperative that you understand how evil these people are. Right down to the customer service that doesn't exist.. STAY SAFE AND STAY FAR AWAY FROM TANGERINE.!!
I maintain a 10k balance on my savings account that pays 4%. That $400 dollars that I receive on a monthly basis is 1/3 of my mortgage. So yes I let the bank pay 1/3 of my mortgage.
what bank pays you 4% monthly? I would LOVE to be with that bank for sure...
$400 a year not a month
A month???? Stop it. 😂
Guy is beating the S&P with his savings account 😂.
@@lespi3162 not unrealistic I make a little over $300 a month in my savings account. Don’t know how long rates will last tho
HYSA are for folks who don't want to take risk.
Or like emergency funds
@@nobodyelse7911 Correct! I keep 20k+ in a HYSA. For emergencies.
PERIODT!
You should never take risks with your savings, unless your rich. I like to take risks - that’s why I take a separate amount from my savings and put it in ETFs. But you should still keep your emergency fund in something like a HYSA
My bank pays out 5% apy and the money is fully liquid ready to be spent at any time without any notice and without any penalties for me
My emergency fund and future house fund…if that’s even possible, are in CDs or a HYSA. Everything else is being DCAd in to the market. Hopefully it’s a solid strategy but I’m not willing to risk my backup funds.
I agree with you, but you can't have all your money invested. I have my 401K and my biggest piece of money, my IRA invested, but I keep my emergency fund in HYSA for right now. If the market drops more, I may invest it thru a brokerage account. But $300 a month interest ain't bad for now.
That’s solid interest monthly!
My guy, CDs and HYSAs are completely different things. CDs are a terrible idea. But HYSAs keep your cash completely liquid, unlike your stocks.
Yep. If you parked all your cash in a savings account a y ear ago you lost out on making a lot of money in the market.
I don’t think you should look at a high yields savings account as an investment. I think it should be used to store funds that you can’t afford to take a loss on (like your emergency fund or your savings for a down payment) while getting a return instead of it losing value in a traditional savings account
Doesn’t a HYSA deposit money into a government security? What is this talk about stock market? And is this guy serious about trying to catch a falling knife? I smell a clown 🤡
It’s good if you wanna make money off of your emergency fund while still having access to your money without high penalties if you withdraw it. I have 5k set aside for emergencies and recently put it into a money market account. I can have it back in no more than 3 days if I need to use it. Not a bad trade off
Well its still a good idea for emergency funds. Most people are not even using the hysa. But I agree the sentiment I am also investing alot during this downturn.
Totally yes! I like to have a small portion of cash for emergency in there!
@@NolanGouveia In where a HYSA?
@@jeffshepoka9899 Yes
No. Just for round numbers sake, banks are giving 5% on CDs. Guaranteed money for you. They then take on risk and lend out the money at 7%. The 2% difference is the spread and that is how they make money. By paying a lower guaranteed rate and receiving and higher rate with risk
I don’t care what they do with it as long as I see my money there in my savings and it’s FDIC insured and it’s compounding in interest by all means invest in whatever stock you want.
IT DEPENDS on what that your plans are for that money. An emergency fund must be in a savings account, if you are looking to invest and grow your money, a brokerage account is the way to go.
What bank do you suggest I start with a HYSA for a beginner at saving. I intend for this HYSA to be an emergency fund.. Right now I am looking to invest 3k and am leaning towards Discover and Capital one 360. Could you help steer me in a good direction? Thanks
My favorite (and the one I personally use) is capital one 360
Use this link as it is my link and we both get reward! Here's my Venture referral link: i.capitalone.com/G6TRfldEA
Savings accounts are slightly different but actually interest rates go up when the economy is down when it comes to bonds and other fixed income investments, it’s not a scam it’s just how our financial system works.
📈💰👍
What is a "solid" etf? New to stock stuff i been dabbling. Lemme know the term ty :)
This video goes over all you need to know for the best ETFs! Using the NEW (better) 3 ETF Portfolio to get VERY RICH
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He sure was right look how much the market has went up in the last nine months feels like it might be time to sell a bit
Part of having a diverse portfolio is investing into stocks CD's having a savings accoung having rental properties. All of it works together to build wealth. Yes sure dumping all of your money into any one thing could lead to disaster. Thats why you dip your toes into everything in case one income stream flops you have the others to bounce off of
I agree with diversifying
its a good idea if you want to use for emergency fund or short term savings-you may not have enough time to recover from major losses. But long term investments are better for retirement.
I use a HYSA for liquid asset emergency fund so I can access it fast
Nice I like that!
I'm kinda new to this space but I agree I opened one through the advice of another individual after I opened a Roth IRA where I'm invested in VOO and SPY wouldn't just be smarter to just invest in the roth over the high yield ?
That’s not how that works. 😂 the interest rates are higher right now. Banks need money to loan out.
So invest the money, when you go to pull pay a shit ton in capital gains tax, end up with less money than you would have in a high yield savings account
This makes zero sense
@@NolanGouveia if I decide to day trade my money, if I make a profit on that by choosing the correct portfolio, I could pay up to 35% in tax. At least the high yield would be stable, I don’t have to gamble the money and hope the stock market goes in the right direction.
It's not a trap during a down, falling market. Also banks are not buying beat down stocks... They are locking in High rate long term Tbills right now.
Are we are in a stag market
For Short term savings goals is good. For long term, I would do other kind of investments.
Some people don’t have the time and knowledge to do that. And can’t afford to lose it if they lose.
Definitely true!
The banks are giningi guaranteed 5-6 % interest. The stock market is not safe right now
It’s 5% and a great place for emergency funds
Lol, just slowly Dca s&p.. I like equal weight S&P and dgro personality... in my 15 and 1/2 years of investing slow and steady always wins the race... (I use DGRO, RSPT, RSPS, RSPD).. But honestly you could just use DGRO and/or SCHD, with RSP.... my attack plans a bit different though😂... but with changing times we must adapt and I also recommend people buy into BTC & ETH crypto wise.... And not now as of the time of this post, but later.. I also recommend the people that have a little bit of silver and gold in it's physical form that = about 2 - 3 months of living expenses and the same with cash so your not spending that gold and silver when things happen.... just assume the gold and silver will be passed on to your kids if you don't need it. ✌️
Lol the stock market is not down and stocks aren’t down. They are at all time highs for a lot of the biggest companies and the S&P is right there. Not sure what you are talking about. And people put emergency savings in HYSA so once again you are missing the mark or the point
So I have an hysa for an emergency plus some money planned for a down payment. Would it be better to put the extra money in the stock market even though I might need that money in the next year or so?
Whatever money you think you might need shouldn’t be invested
Is chime a good savings account to use
Isn’t it still better than Chase’s 0.01%? I don’t have a HYSA and I got too much money in there thinking I would buy my first home with it
Definitely better than that yes!!
dude!!!!! You do a great job on your videos. i'm glad i found your channel. thanks man.
Thank you so much!! I appreciate it!
Dude not everybody got time to sit around all day watching a computer screen waiting to BUY BUY BUY SELL SELL SELL
Just invest once and forget about it. No need to sell and trade
A HYSA is not a trap lol if I’m just parking my money at home or a regular savings account I’m getting nothing for it the money isn’t growing contrast with putting that money in a a HYSA then your atleast getting something back on interest. Add to the fact if someone has a Roth IRA and a 401k and it’s a no brainer to also open up a HYSA. Not a trap man but I see what ur trying to do and investing in a brokerage account is very good if you don’t already have one
Yes I definitely agree with this!
This all sounds good, investing in companies that should recover...unless The Big Guy loses a second time. 😤👧🏻
Makes sense but certain online banks like ALLY and AMEX insure up to 250k
Yup most do!
I don't view it as a trap...I need emergency fund money on the side. HYSA's provide that with some growth instead of Wells Fargo savings account with almost no growth.
What’s some of the ETF’s and solid companies you look to invest in?
Professor,as for etoro?is it a good brokerage platform to start with?
I do like etoro yes
Look, no one said that HYSAs were the end-all-be-all to growing your portfolio. But I will not hesitate to park some of my money there. And yes, there are other places to put your money to work for you, to be sure. So, you shouldn't discount it, out of hand. One of the attractive things about it is that it is extremely liquid. You can get your hands on it, right now! Day, night, weekends and holidays. It's there in case you have an emergency.
exactly my qqq position up 25% started it last jan 2022
Heck ya
I'm getting 5.05-5.10% on a high yield savings account
That’s solid
WHERE????? ARE YOU ACTUALLY GETTING IT OR JUST THATS WHAT THEY SAY LIKE TANGERINE???
What do you think about Tbills?
I'm concerned. I may not be a smart man but banks offering higher interest if they can hold your money longer is pretty normal and good for business good for consumer.
Are you investing in T Bills?
I’m not personally but I do like it as a viable option
So how does a high yield savings account actually work? How much do i need to put into high yield savings account?
You can put any amount you want. You could put nothing in it, technically.
Can’t you just take the money out of a high yield savings account whenever you want to ?
Yes but you’re limited to 6 withdrawals per year for most banks because they need to make a profit too.
@@stephaniecobian725what if you put in $10K in HYSA and make 5 withdrawals each of $2K, can you do that?
I get $3000 a month interest in CDs. I just don’t want the risks of stocks.
That’s great! I don’t blame you
If thats true then you’re Set 👍🏾
@@redscorpion9325 $3115 a month
Whats CD?
@@aswathysagarcertificate of deposit.
BAD ADVICE & OBVIOUS. Poster is not comparing apples to apples. If you're placing money in a savings account, you've already claimed that you are a conservative investor and there's nothing wrong with that. The comparison should be high yield savings account compared to a brick and mortar shop and in this case it's a great idea.
Professor G is the man, he likes sports, has good character, and is good with money
I appreciate that 👊
Download market?.... The S&P is up 40% off the lows.
Following of course but please help guide me with what to do with my wife's sitting 401k with 35k in it. I would love to roll it over into some type of Roth IRA if even possible or if recommended to allow it to grow without the threat of future taxation. No longer working with that company FYI.
Thank you in advance for all that you do. I'll be also helping my parents and in laws with investing with your 20, 30, 40, 50, 60 video. God bless.
You can roll it over to an IRA or if you’d rather do a ROTH, you’d just have to pay the taxes on the 35k
I appreciate your advice. Just opened a Roll over with Fidelity and moving over my 401K and working on my wife's next. Thank you again.
😂 or the market goes even further down because you picked the wrong stock or bought/sold at the wrong time. I'm tired of "guros" gambling on the market
I'll take my easy 4.3 % for doing significantly less work.
Banks dont even have your money to hand
Buy that dip! Buy that dip! 💪
📈💰🙌
Be greedy buy buy buy time is on your side. Yes it is.
🙌📈💰
They aren't putting it in stocks. They are typically putting it in overnight markets and bonds. But the issue isn't the return, it's the liquidity. You use a savings account to get a return on money you need to remain liquid. Money in stocks is generally going to need to be locked down for an extended period of time to recognize gains and so you can't just put your spending money or your tax liabilities into them.
I'm about to open one. I'm working on a down payment for a house
In 2 years max I will need soon I think it's best lock up somewhere no?
2 years yes that’s fine
Oh ok thx
wait, don't all bank accounts
do this?
SoFi is offering 4.4%, so i have all my left over money in there. whats the move?
Good place to have it!
Thank you always for your info Professor G!! Needed to hear this one today
🙌💰happy to help!
It's still a smart move compared to putting it in a bank with 0.01 to none % apy. And charges you monthly fee if you are below a certain amount.
Very true
Yup, I made that mistake for too long with chase....I wized up.
It’s a mutual benefit. You gain the 3% with no downside. You don’t like it? Send the funds back to your normal savings, which honestly I’m not sure the purpose of that is. With inflation, you actually lose value leaving it in a normal savings account. At the very least, the high yield savings will offset set that
It’s not a trap. It’s best to diversify your income. Invest & put some in a HYS account.
Not true. I get 5.5% return on my high yield because of the high fed rate. Banks base their rates off of the fed rates. On top of that, the maturity date is 8 months. If the stock market takes a dump, I can buy those stocks then rather than lose money in the stock market now
I just put money in both...
Smart!
This is crazy. Many ppl can’t gamble with their money like others can. Calling it a “Trap” while actually attempting to trap ppl in investment they know nothing about seems rather…. Misleading to say the least.
I would agree 100% that ppl should never invest in what they don’t understand. Literally every one of my videos says that
Yes this is true. But with a CD you have a guarantee of a certain percentage and at a exact end date. You have no clue when the market will recover and it could take two years. You never know. So I’d rather take a safe 3 percent CD every 3 months then risk having to wait 1 or 2 years to be up 20 percent on a stock which the market is never certain like a CD is.
Deploy your hysa in a market downturn
I hear you big guy but not everyone who has a hysa puts 100% of their savings in hysa. its an emergency fund that you're gonna use in the near future. As long as the person is still investing in other things, I don't see how your video makes sense of it being a trap.
Thoughts on Yieldmax TSLY?
This is false information. There is a huge difference between a CD and a High Yield Savings Account.
Pretty sure banks never do this and they actually buy things like T bills. They aren’t buying Apple stock with it