3 ways regular people use their high-yield savings account to be better with money

• A no-fee high-yield savings account can be a great tool to organize your money.
• Most high-yield savings accounts offer 2% interest or more (although rates are subject to change), while savings accounts at traditional banks can offer as little as 0.01% interest.
• Everyday people use high-yield savings accounts to store emergency funds, keep track of separate savings goals, and curb impulse spending.
• Read more personal finance coverage.

If you’re trying to organize your financial life, you may find that a high-yield savings account (or multiple) is just what you need.

Not only do these savings accounts typically earn 20 times more than your everyday checking account, they’re also a great tool for keeping your cash safe and accessible. Most banks allow savers to open several at a time, nickname them, and set up automatic transfers from different accounts. And the best ones don’t charge any fees.  

Keep reading for ways to use a high-yield savings account, from people who love theirs. 

1. To store an emergency fund

Everyone needs a rainy day fund to fall back on when sudden, or even planned, expenses crop up.

Melanie Lockert, a self-employed writer and entrepreneur, says online savings accounts are the best way for her to keep track of the money she sets aside for taxes, sick days, and emergencies.

“Being clear and specific with my savings goals has transformed my financial life for the better,” she writes. “I am more clear, focused, confident, and know exactly how each dollar is used. Not only that, but it has given me peace of mind to know that I have money in the bank and that I’m prepared for a variety of situations.”

2. To save for specific goals

Did you ever ration out your change into jars as a kid when you were saving up to buy a toy or go do something fun with your friends? High-yield savings accounts are the adult version of that, but better.

Brynne Conroy, a personal-finance blogger, utilized a high-yield savings account when she was working toward the goal of buying a house. She wanted to grow her money quickly, and most importantly safely.

While Conroy acknowledged the potential downsides of her high-yield savings account — interest is taxed and money takes a few days to transfer to her primary bank — she ultimately found them to be minimal compared to the benefits.

“I don’t mind an extra 1099, and being rewarded with a higher APY in exchange for the accessibility of funds in moments of temptation is just too sweet a deal to pass by,” she writes.

3. To curb impulse spending

If you’re keeping the money you intend to save in your everyday checking account — or even a savings account linked to your checking account — it can be too easy to throw caution and logic to the wind and dip into it when impulse strikes.

Freelance writer Elizabeth Aldrich says six of her 10 bank accounts are high-yield savings accounts, including a “no impulse purchase fund.”

“This account is for purchases over $100 that I want to make in the short-run, and I keep the balance at $0. If I want to go out to eat once in a while or need some new clothes, I do, but I’m not allowed to spend over $100,” she explains.

“This ensures that I don’t overspend on things I don’t really want and gives me some time to mull over how much I really want to purchase the item, so I avoid buying things impulsively.”

• More savings and retirement coverage
• How to retire early
• How to save more money
• Are CDs a good investment?
• When to save money in high-yield savings