I know this is not a financial community but I trust the knowledge I get from it

[G+_Rud Dog]

I know this is not a financial community but I trust the knowledge I get from it.

Anyone have any input on :

 

personal savings. american express

[G+_GeezerGeek]

I trust my auto mechanic too,

but not for medical advice. :)

[G+_Rud Dog]

Unless he is holds PhD one never knows what one might find in a community such as ours. Agreed on the

[G+_Black Merc]

Rud Dog everyone has to deal with money so... I think this fits. The show is 'know-how' and if no one knows about this product we should investigate.

[G+_Paul Hutchinson]

Both can be wonderful, both can be horrible.

 

Question is so incredibly broad it would take multiple books to explain all the possible bits of information. Like asking for input on food and beverages.

 

Do you have specific questions?

[G+_Rud Dog]

Paul Hutchinson Thank you for joining the discussion my foremost question has to do with the legitimacy of the institution. Asking this question of people that have actually used it, that way I don't end up on the evening news telling how I got bamboozled. Sure there could be some supporting the scam but this won't be my only source for basing my decision but a tool for gathering info on the company.

Hearing from those that have ventured down this avenue can lead to further private messaging on their experience.

Just trying to stay as safe as possible with those in the know (how).

[G+_Paul Hutchinson]

I think I have figured out what you are asking. You are considering opening a personal savings account with American Express. The way you wrote the opening post it I thought you were asking about two different things, personal savings, and the American Express financial services corporation. If you had posted this: https://personalsavings.americanexpress.com, that would have made your question clear to me.

 

Assuming I now know what you are asking here's my opinion.

 

American Express is very old and well respected corporation that as far as I know has never gotten into any major trouble with the government for financial shenanigans. All of my dealings with them over almost 40 years have been OK.

 

However be aware that what they are offering is not what most people think of as a traditional savings account where you can withdraw the money whenever you need it. They are selling you a CD (certificate of deposit) which provides better interest because you have to pay a penalty fee if you want to take out the money before the CD matures.

 

I recommend you check with a local bank to see what rates they offer on CD's of the term length you are considering from AMEX (AMEX offers 1/2 year up to 5 year terms). A local bank may offer similar rates and being local you can ask them questions face to face.

 

An important point in favor of them is that CD's, like regular savings and checking accounts, are insured by FDIC. So there is no risk of loosing the money, FDIC will reimburse you if the bank goes out of business, burns down or is robbed. Where as higher yield investments such as stocks come with the risk of loosing it all.

[G+_Rud Dog]

Paul Hutchinson That is very interesting. The first question asked, was this a saving account or was I purchasing a CD. They responded with we offer both a saving account or purchase of CD. Now I understand what they say over the phone means nothing. I requested a saving account option. I have 60 days to fund the account so will log in and ask more questions before funding the account. Thank you for your input.

[G+_Rud Dog]

While collecting info ran across this:

What is a High Yield Savings Account?

A High Yield Savings Account is a savings account with a variable interest rate typically higher than retail brick-and-mortar banks. High Yield Savings Accounts are limited to a maximum of six (6) online and telephone withdrawals or debits per monthly statement cycle. Interest on High Yield Savings Accounts is compounded daily and posted to accounts monthly.

No mention of CD's but again this means nothing so continuing to research.

[G+_Black Merc]

I've always thought 'high yield = high risk' the same as a lottery ticket, or 'hot' stock... Chance to win big with low probability.

[G+_Rud Dog]

Black Merc This is what I am attempting to decipher before funding.

[G+_Paul Hutchinson]

Their site confused me, it looked like all CD's but with more careful reading I now see the High Yield Savings.

 

From the FAQ page:

"What is the difference between a High Yield Savings Account and a CD?

High Yield Savings Accounts offer the flexibility of up to six (6) withdrawals in a statement cycle. The rate is variable, so it can increase and decrease over time. Certificates of Deposit lock in the interest rate, but there is an early withdrawal penalty."

 

Without doing the math I'd guess that over the long term a HYS does give abetter return than a traditional savings account but not nearly as good as a CD. A lot will depend on how interest rates fluctuate since the HYS is variable.

[G+_Jason Marsh]

TLDR: Find a local institution, as they're staffed with real humans. Also, feed the pig. Often. Until it hurts.

 

I have no personal dealings with Amex, but I have dealt with many banks, large and small, and have so far been happy with only one. For me, that's USAA. They're like a credit union, though, in that you must qualify for membership. If you're a Veteran or direct descendant of one, you're good to go. Otherwise, read on...

 

I've dealt with two credit unions, the second I've done business with for close to 25 years. Credit unions exist to bolster their membership's financial readiness, by providing deposit accounts, loan products, and credit cards. The membership elect the officers of the CU, so as a member you have a voice.

 

Not so much for a bank, which exists solely for it's own benefit. Yes, they provide generally the same products as a credit union, but you have no input as to who's running the boat, what the product lineup will be, etc.

 

At a bank, you're a customer. A number. A profit center.

At a CU, you're a member, a voting member, and you'll get more personalized service.

 

Savings, even "jumbo" or money market accounts, hardly pay enough to differentiate between organizations, whether a CU or a bank. Savings, though good, isn't really an investment vehicle that'll do much beyond keeping safe the cash you set aside for emergencies, to buy a new roof or anything else unexpected. For building wealth, you need to consider other investment vehicles, such as IRA, 401(k), exchange-traded funds, or mutual funds offered through (but not by) your financial institution or through another, separate entity.

 

For anyone just starting off on their journey to financial freedom, I'd advise you just focus on finding an institution that is known and respected in your community. Start small, get used to packing money away, and enjoy watching it pile up. Whether it's gaining a lot of interest or not, it will build up on you and you'll wind up with a chunk you can put into something else that can actually make some money. Lather, rinse, repeat if desired...

[G+_Rud Dog]

Jason Marsh Low risk is the priory and yes as the discussion moves forward requirements rain down. I am a veteran and was wondering what the saving account interest rate at USAA?

[G+_Jason Marsh]

USAA's Savings rates are pretty low. 0.05% to 0.15% APY for a standard savings account, up to 0.30% for their "performance" savings account.

 

I have been with them for 20 years or so, and have been pleased with customer service every time. I've been lucky enough to get caught in card skimming hell a couple of times, and they've been great about it, refunding 100% of fraudulent charges within the first day or two from notification.

 

Also, they have some decent mutual funds of their own. They offer discount brokerage services, but I haven't used them because my other sack of gold is in a 401(k) that I'm not ready to take the tax hit on yet.

 

...And I've had auto insurance through them since forever. They've been great. For a while I had a problem with speed limits and fines, but they didn't rake me over the coals about it. I sold the sports car and, viola, not been stopped since :)

Claims are easy, as well. Not that you want to have to make a claim, but if you do need to, they're super relaxed about it. Never had to twist anyone's arm or haggle over value. Far better experiences with USAA than I ever had at Geico.

 

I have heard and seen testimonials of people who think USAA is the devil. Angry for being bounced from USAA after a series of bounced checks. Never had a problem with that. Wouldn't advise anyone bounce checks from any bank. Stay within your means and things sort of take care of themselves.

[G+_David Wiggins]

+Jason Marsh is spot on. I'm in a credit Union from work I did for county government and whatnot. Their CDs were stable, and had competitive rates. Mine also has a Money Market account type with similar transaction restrictions to that HY savings. And the personal contact element is huge. I got my car loan through them, and when looking at long term investment, they say down with me for about half an hour to map out options from them and others. They actually recommended a CD from another CU I was a member of.

 

I recommend local any day. (Granted, I live near a banking hub city.) Still, people tip the balance.