A New Cash Option
Depending on how long you have been working with us you have likely heard us reference online banks such as Ally or Capital One. These banks are not like your traditional banks in the sense that they don’t operate as brick-and-mortar entities. They do not have physical locations or face-to-face tellers. However, because these costs are less they are able to offer higher yielding savings accounts. Some of which are currently yielding 2%-3% to hold your money.
Over the past couple of years we have started working with an online bank called Flourish. This is an online bank that works specifically with financial advisors. A few of our clients have already started using this platform to hold their emergency savings. Until now the rates offered have mirrored those at Ally and Capital One fairly closely. But that has now changed.
Over the weekend Flourish released their updated interest rate schedule of 3.75%. Put more simply, if you were to move your savings account to Flourish they would pay you 3.75% per year on your money. In comparison, Capital One is paying 3% and Ally is paying 2.5%. For every $10,000 you shifted to Flourish you would earn at least an extra $75 per year over other online banks. This rate is subject to change based on the fluctuation of interest rates, but has been steadily increasing throughout the year.
Flourish operates very similar to Capital One and Ally. You are able to link your external bank accounts right to Flourish and then transfer the money directly with only a day or two for delivery.
We consider this type of account to be a home for emergency funds only. These are your true reserves that don’t fluctuate all that much. As such, parking them here and earning the additional yield can be worth the 10 minutes it takes to set up the account.
This account is not considered a managed account, and as such, is not considered for billing purposes. This is simply a free extension of service for working with us.
In order to establish the account our staff is required to send through the application. If this is something you are interested please feel free to contact our office and we can provide the information required.