Money Allocation
***Last updated October 29th, 2007***
Aside from the usual checking account, I’ve been looking around for a savings account that has high yielding APYs. When I found out about FNBO Direct, I was pretty excited since they had a promotional APY that was at 6%. Unfortunately, that ended and it’s back down to a 5.05%. It’s not bad since it’s still in the 5+% range, but I’ll still be looking around for better ones.
Washington Mutual’s checking account + online savings account (5% APY) is very tempting because of the fact that both checking and savings accounts are directly linked, but I guess the bank location is a big factor in my decision to stick with BofA. ATM machines and banks for BofA are everywhere and I find them more often than WaMu banks, so I decided to stick with my current bank. Well, here’s a diagram of my current bank setup.
Here’s a graph for fun.
I get instant transfers, although limited to $1,000 per day, between my checking and my savings account and 3 day transfers from either of my BofA account to FNBO Direct. My checking account’s balance fluctuates a lot because I generally use my debit card often so it can look bad sometimes and good the other. My BofA savings account is definitely more stable but it very slowly increases everyday due to BofA’s Keep the Change program. But it’s at a pitiful .20% APY. Gross. I just have this one for quick emergency situations for extra cash.
My second savings account, with FNBO Direct, is the high yielding savings account. It’s a safe online savings account since it is FDIC insured. I’m earning over 5% interest with this account. I don’t have much cash to throw in here, but I’m still liking the return I get. I’m throwing in 22% of my paycheck in there monthly, which is a good size figure to contribute. If my yearly income, contributions, and spendings stay the same for the next 10 years, then I’d have $62,000 by the time I’m 33. Pretty good.
With $500/month contributions, over $82,500; with $1,000/month contributions, $160,000; and with $2000/month contributions, $316,000.
