Best Savings Account or CD earnings

[Anonymous]

My daughter has a savings account that she set up for her son.  She puts money in it every week when she gets paid.  It is starting to grow fairly well but she wants to earn more interest than what her bank is paying.

Looking for suggestion on where she could park the money to earn the most.  Thinking maybe a CD or Savings Bond might be a good idea.  She just really wants to shy away from anything stock related.  

[Sandman771]

She could break it up into fourths and get four 12-18 month CDs. Buy one every three months to create a ladder. PenFed has decent rates. I opened one the other day at 1.25% for 18 months. I have read others on here with higher ones. 

[Anonymous]

I understand the ladder analogy.  But is the idea with that to take advantage of higher CD rates if the Fed raises interest rates again.  

[Sandman771]

Yes that way you don't lump it all together and your maturity dates are also spread out as well. 

[Anonymous]

Awesome, She's a member of NFCU and they have a rate of 2.25 at the moment for CD.  

[Anonymous]

How much are we talking about?  There are several CUs that have savings accounts @ ~5% APR, for lower $ accounts, up to 500, 1k, or similar.

[Ardecko]

I have my DCU savings filled to the 1k mark. Are there others that don't require me to change my DD or do mystic chicken dances with their debit cards?

[Anonymous]

She may want to combine the safety she desires in a CD with the tax free advantages of a Roth. 

http://www.rothira.com/roth-iras-for-kids

https://ptmoney.com/roth-ira-cd-tax-advantaged-retirement-investing-without-the-risk/

With a Roth she can also change her mind if she develops less of an aversion to stocks.  If she intends for the money to stay in the bank for a long time before her child accesses it, stocks are really pretty safe.  They are only risky in the short term.  Like many working people my retirement account took aa huge hit in late 2008.  But by staying the course and not panicking, my investments were back at the levels they were in 18 months or so.

[Anonymous]

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@Ardecko wrote:
I have my DCU savings filled to the 1k mark. Are there others that don't require me to change my DD or do mystic chicken dances with their debit cards?

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An Insight account gives you 5% on the first $5000.

https://www.doctorofcredit.com/insight-5-apy-prepaid-card-5000/

Here is a more extensive review of high yield savings options.

https://www.doctorofcredit.com/high-interest-savings-to-get/