Is it safe to move mothers savings to high interest online banks?

[Anonymous]

I’m POA for my 81 yr old mom. She has a few checking accounts totaling about $500,000 and see that both banks have very low interest rates. I started looking online and there are banks offering 5% on savings accounts. No penalties no fees. I’ve researched and it seems to be all legitimate and safe and FIC secure up to 250k. Of course I would use two different banks.

[Anonymous]

I think they are safe as long as FDIC insured and keep below the 250k limit. I advised my 80 yr old parent to move their assets to one.

[Anonymous]

Anonymous wrote:I’m POA for my 81 yr old mom. She has a few checking accounts totaling about $500,000 and see that both banks have very low interest rates. I started looking online and there are banks offering 5% on savings accounts. No penalties no fees. I’ve researched and it seems to be all legitimate and safe and FIC secure up to 250k. Of course I would use two different banks.

Which banks are offering 5% on savings?

[Anonymous]

The highest I can find is 4.3 at Varo, where are you seeing 5%? I realized I was getting .01 at Truist, I moved my money to a money market account at Ally to get 4% which is 400 times higher than that. I'd say you definitely need to move your mother's money if your bank rate is as pathetic as mine was.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I’m POA for my 81 yr old mom. She has a few checking accounts totaling about $500,000 and see that both banks have very low interest rates. I started looking online and there are banks offering 5% on savings accounts. No penalties no fees. I’ve researched and it seems to be all legitimate and safe and FIC secure up to 250k. Of course I would use two different banks.

Which banks are offering 5% on savings?

Nerd wallet publishes this info monthly (of c fine print): https://www.nerdwallet.com/best/banking/savings-accounts

[Anonymous]

It is safe, but your mom may not be happy with not having a local bank. We had to keep 100k in a no interest checking account to keep my paranoid MIL comfortable. You should definitely discuss it with her.

[Anonymous]

I use Ally and Salem Five Direct.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I’m POA for my 81 yr old mom. She has a few checking accounts totaling about $500,000 and see that both banks have very low interest rates. I started looking online and there are banks offering 5% on savings accounts. No penalties no fees. I’ve researched and it seems to be all legitimate and safe and FIC secure up to 250k. Of course I would use two different banks.

Which banks are offering 5% on savings?

Nerd wallet publishes this info monthly (of c fine print): https://www.nerdwallet.com/best/banking/savings-accounts

Yeah, no such thing as 5% saving there. The best rate is 4.25

[Anonymous]

Some banks offer higher FDIC coverage through something called reciprocal deposits (a behind the scenes arrangement between multiple banks to exchange an equal amount of funds at close of business in order to provide a higher rate of insurance for customers). Typically large banks and investment banks offer these types of arrangements.

[Anonymous]

Wealthfront is 4.3% and up to $2M is FDIC insured through partner banks.

[Anonymous]

Yes jeep under $260k and don’t use ally.

[Anonymous]

Anonymous wrote:Yes jeep under $260k and don’t use ally.

What's wrong with Ally and what does a jeep have to do with it?

J/k but seriously, what's wrong with Ally?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I’m POA for my 81 yr old mom. She has a few checking accounts totaling about $500,000 and see that both banks have very low interest rates. I started looking online and there are banks offering 5% on savings accounts. No penalties no fees. I’ve researched and it seems to be all legitimate and safe and FIC secure up to 250k. Of course I would use two different banks.

Which banks are offering 5% on savings?

Nerd wallet publishes this info monthly (of c fine print): https://www.nerdwallet.com/best/banking/savings-accounts

Yeah, no such thing as 5% saving there. The best rate is 4.25

https://www.bankrate.com/banking/savings/best-high-yield-interests-savings-accounts/

[Anonymous]

Anonymous wrote:It is safe, but your mom may not be happy with not having a local bank. We had to keep 100k in a no interest checking account to keep my paranoid MIL comfortable. You should definitely discuss it with her.

I’ve discussed it with her and she is fine with it. She is pretty much home bound and my siblings pay for her groceries and I pay for her Amazon orders. Her full time caregivers are paid with her investment income. My mom did freak out when I changed her accts to paperless. Haha I finally was able to drag her into 2023. Plus she has come to the point where she doesn’t want to be bothered with anymore financial issues. She trusts her children.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Yes jeep under $260k and don’t use ally.

What's wrong with Ally and what does a jeep have to do with it?

J/k but seriously, what's wrong with Ally?

+1
Several family members and I use Ally. No problems and I like how quickly they raise interest rates. Maybe not the absolute highest but lets me park my money there without feeling like I'm missing out on higher rates if I don't compulsively keep moving my money to chase higher rates.