Zero Nada Nil …. or 1.5% ?

For conservative investors, now is about the most difficult time ever to earn a safe return on your cash. Short-term Treasuries offer almost no return. Savings accounts, Money Markets, even CDs are offering extremely low rates. Many investors will receive monthly statements showing a 0% return for their money market account in January and a 7-day Yield of 1 or 2 basis points going forward.

Today I came across an interesting promotion from American Express Bank that I thought was worth sharing. According to this online promotion, customers may setup a high-yield savings account that provides an advertised 1.5% APY as of February 2nd. Interest is compounded daily and credited monthly to your account. These are FDIC-insured deposits. There are no fees or balance requirements. You can do it all online or call 800-446-6307 for telephone assistance. You may make up to six withdrawals per calendar month to your linked bank account.

Now, I realize 1.5% APY is nothing to write home about, but relative to the near 0% return of short-term Treasuries and money markets, at least you’ll earn something on your cash balance.

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