1 Reason to Use Coinbase's New 4% Savings Account, 1 Big Reason Not to
Believe it or not, there used to be a time when one could actually earn decent returns in a bank savings account. But these days, we are in an era of extraordinarily low interest rates. The national average yield on bank savings accounts is a paltry 0.07%, according to Bankrate.com. Sure, some newer branchless banks may offer "high-yield" savings accounts, but those still typically yield only around 0.5% at the very highest rates.
However, cryptocurrency brokerage Coinbase (NASDAQ: COIN) is looking to give consumers a high-yield alternative that may actually compete with corporate bonds and dividend stocks. Last week, the company unveiled a savings account with a 4% APY (annual percentage yield), taking aim at U.S. banks, fintechs, and other brokerages alike.
Here's why the new savings account may be a great option for the fixed-income portion of your assets -- but with a big caveat, which may give savers a reason to tread with caution.
Source Fool.com
