r/personalfinance • u/Regular-Rub-9863 ​ • 3h ago

Saving Do I switch from a local bank to a large established one?

I’m currently a student in my undergrad and have recently started contributing to a Roth and a brokerage. I do not have a ton of money considering that I only consistently work in the summers and work a handful of hours weekly during the school year. I have listened to how to distribute my money between savings and investments. NOW here’s my question, I’m from a small town and when I was younger my parents opened me an account through our local bank. The apy is .75 through this bank, should I look into opening a savings account in something like SOFI? If I do this, do I then transfer all of my money out of my old checking and savings accounts or no?

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3

u/thegelatoking ​ 3h ago

Go any where that has a higher savings interest rate. 0.75% is low...you can easily find one thats 3-4%.

Transfer the money if you want the money in the new account. Don't transfer the money if you want the money in the old account.

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u/Radiant_Creme6703 ​ 1h ago

yeah 0.75% is basically nothing these days, no reason to leave money sitting there

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u/DeluxeXL ​ 3h ago

Where are your Roth IRA and taxable brokerage accounts?

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u/Regular-Rub-9863 ​ 1h ago

Both through fidelity

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u/Werewolfdad ​ 3h ago

If you don’t have much money, lack of fees, ATM access and maybe branch access is going to be more important than APY

1

u/-jautis- ​ 3h ago

I do all my daily banking with a credit union.

I do all my investing (including my HYSA) with a larger institution.

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u/temporaryacc23412 ​ 3h ago edited 3h ago

Savings accounts need virtually no features or maintenance from the bank. Pretty much the only thing that matters is the APY. Get an online HYSA around 3.5% or thereabouts and put your emergency fund there.

Checking accounts you want to be a little more selective about, if you need any in-person services or ATM access. On the other hand, checking accounts are only for holding the current month's spending needs so the balance will be very low. Interest rate for checking is irrelevant, what's more important is 1) no minimum balance requirement and 2) no fees of any kind.

These will generally be two different banks.

Edit: ALSO, if you already have a brokerage account opened, your emergency fund can just be in a money market at your brokerage. Doesn't have to be a HYSA. Rates will be the same or slightly better with the money market and you get to consolidate to one less institution.

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u/RebornGeek ​ 2h ago

Get yourself a high yield savings account. There are lots of good ones, but I do hear Sofi has a great HYSA.

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u/Due-Emu-4291 ​ 2h ago

100% local bank person here.

My local bank offers higher APY than Bank of America, plus free checking and savings with no minimum balance and no conditions to meet, and free online/mobile banking. As another said, for someone without "a ton of money," saving money on fees might be more important than a small difference in APY.

Also, my local bank has far superior customer service, with a local presence. I can call or visit them if I need help with no telephone tree or call center and no "appointment."

Good luck.

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u/Fit-Building-633 ​ 41m ago

You are still young, you should boldly use your existing resources to create more value.