Savings Account

[Jesse_emel]

This is kind of a joke, but I'll put this out there anyway. My wife and I wanted to start a savings account for our son's future college (who is 2). I went to Washington Trust Bank and opened a savings account and deposited our first $200 and after all the work was done I asked what the interest rate was. They told me it's at a jaw dropping 0.10% So on $100 we earn $0.10 a year that's almost a penny a month. $100 x 0.001 = $0.10 YIKES

So I guess I'm asking if anyone in Washington knows of a better bank with a better interest rate, Or as we get more money saved up a better way to invest it. When I was little i remember getting 3-4% boy things sure have changed.

 

[broskie]

I've always used BECU. They have great rates and cd options.

 

[jrgilles]

If you work in education, you can open an account at SECUWA (School employees credit union of washington.)

That give you 7.5% interest for the first $750.00 then something like .6% for anything past that. This applies to both your checking AND your savings, so combined you get 7.5% interest on $1,500, or $112.50 in interest per year, then .6% for anything over that.

Hmm, you might have to have direct deposit set up to get that advantage though, so you would probably have to check with them (and of course, work in education)

 

[mcvicker]

If your employer offers a 401k plan call the company that manages the plan. They will typically offer a 529 plan for college savings and will waive the deposit fees since they also manage the 401k. The 529 plan is deposited after tax but none of the proceeds are taxable. That way you get a high return on mutual funds but avoid the taxes. You also avoid a lot of the fees.
-chris

 

[Echris]

You could also look at the Washington GET program instead of the banks.

http://www.get.wa.gov/

Eric

 

[roscoe]

I bank with BECU and they have great rates. However I am also interested in setting up a college fund for my new daughter soon and would like to know where I can get the most return on her money also. i will keep an eye on this thread.

 

[returnofsid]

Just about any credit union is going to give you a much better interest rate than any bank.

 

[roscoe]

I think most of us are aware of that Mike. I think what the OP along with myself want to know is a specific entity that can get us the most return for our money.

 

[brandyrb]

School Employee's Credit Union of Wa. is the best I've found. You either have to work in education or be a family member of someone that has an account setup to join though. Here's there site: https://www.secuwa.org/home/home

That's who I go through. I could adopt you... j/k. We just got an auto loan through them for 3.74% interest and both our savings and checking accounts earn 7.71% interest on the first $750 then .75% for balances over $750 in savings and .25% for balances over $750 in checking.

 

[roscoe]

Thanks for the info Brandy. I do have a cousin that is a 1st grade substitute teacher right now. Do they have to be a full time employee? I might have to hit up my cousin to get me the hook up for this!

 

[jrgilles]

yup, as I said. SECUWA is the best bank EVER

 

[brandyrb]

Thanks for the info Brandy. I do have a cousin that is a 1st grade substitute teacher right now. Do they have to be a full time employee? I might have to hit up my cousin to get me the hook up for this!

I'm not sure if she'd qualify or not. I'm a PT employee right now, but I'm permanent status, not hourly. I'm actually a web developer for the community colleges of spokane. They also do a credit check just to setup an account.

yup, as I said. SECUWA is the best bank EVER

I agree.

 

[Jesse_emel]

Yeah I work in Engineering. Not in Education. I think tomorrow i'll call my 401K provider and ask some questions. I'll report what I find out...Thanks everyone for the info.

 

[Chichas01]

How about a 529 plan?

http://www.savingforcollege.com/intro_to_529s/what-is-a-529-plan.php

 

[roscoe]

. They also do a credit check just to setup an account.

Thanks again and no worries about the credit check.

 

[Blindloser1080]

As some have already said, BECU. I believe they do a pretty good rate, and if the amount is under $500.00 I think they do like a 2.5% or something like that.

 

[nwinverts]

Hate to say it but the bottom line is, savings rates are in the ditch...

My advise would be to check out the Get program or a 529 for Collage savings, which were mentioned previously. If you going to just open a savings account you should go to a credit union till you hit their low limits, at which point you should look at an online savings account. http://www.savingsaccounts.com/bank.aspx?bankid=24&f9tc=GOOGHPSavingsAccount

Then when you save 10k-20k you can start laddering cd's. Of course I'm talking about loooog term savings. Not money you'll need on any given month, for living expenses.

Just my .02, YMMV.

 

[TotalVapor]

best way is a 529 plan otherwise known as the GET program / Prepaid College Tuition Program

 

[bigblue141]

First, I give you major props for starting a savings account for your child early.

If you are looking at setting up a savings account for your son, I would be leary about setting up a "college fund" account as the money can only be used schooling. If your son decides to opt out of going to college you will be stuck with a bunch of money you can not use without paying HUGE penalties.

I personally recommend to everyone that comes and see me to look into a "no load" mutual fund. Make sure you do your research prior to purchasing. There are several Credit Unions Nationwide that offer decent Mutual Funds. Most good funds no longer require a major initial ($5-10K) deposit. Look for something with a good morningglory rating that will allow you to open the account with $50 or $100 a month. If you can get a fund that averages 8-10% a year you will end up having around $20k in the account in 18 years with a $100 a month deposit. I strongly reccomend you open 2 accounts. One for your childs retirement (He will have over a million dollars at age 60 if there is $10k in the account by age 21 and the account averages 10% a year with no additional deposits.) If he chooses not to go to college, you can gift him the money, or you and your spouse can use it. (I'm also aware that there is very little if any mutual funds out there that are currently making over 5%. That's why it is a long term investment. I know it's discouraging at the moment, but things will turn around and you will end up with a year or two making well over 20%, so in the end it will average about 10%.)

There are thousands of resources on the internet for long term saving, as well as thousands of calculators out there. Just remember that inflation is around 3% a year on average, so when your son is retirement age, a million dollars is going to be chump change, and will not be able to provide annuity payments for the remainder of his life. (I know that is a very long time from now, but it's something to think about.)

 

[MrGone]

BECU offers pretty good rates and is good to use for your daily accounts IMHO. ING typically offers better rates but less liquid. The other nice thing is ING is tied to sharebuilder if you use that. Locking in rates with a CD couple year ago would have been good but for college specific I think the GET program would be the best.