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Apple Card’s new high-yield Savings account is now available, offering a 4.15 p

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Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p

#191

Post by yardie »

rchaud wrote: post #93
cj wrote: post #37

Earlier quoted context omitted.

Bank accounts are one of the lowest "customer churn" services out there. People typically open a bank account and use it for years and years (which turns into decades on decades). Until someone like Apple comes in with a one click UX to open a bank account and set everything up, existing banks have no incentive to make existing clients happier because they're extremely unlikely to move banks (or even to open a better…

One click setup isn't going to do it. If Apple is providing banking-type services, they're going to need to have support available at the Apple Store. If they don't, banks will beat them every time. Customer support for noney is not something that can be left to a chat window.

My bank, Capital One, is a glorified cafe and co-working space. If I try to do any "banking" there they will literally redirect me to use the app. You can definitely do banking completely online. You simply need to have the systems and employees in place to maintain or exceed expectations.

I stopped using BoA because the in branch experience has declined. I never used Wells Fargo for obvious reasons.

Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p

#192

Post by Someone1234 »

jedberg wrote: post #176
gurjeet wrote: post #63

It's interesting that they will not accept any transfer-in, even reject a transfer, if the balance exceeds $250,000. This must be because of the FDIC insurance limit, and hence protects the consumer's savings. Quite the opposite of what some banks are trying to do: offer accounts that try to provide FDIC insurance over 250k by spreading your money among other banks. From the footnote 1: https://www.goldmansachs.com/t…

My guess is that it has little to do with FDIC and a lot more to do with them not wanting to pay so much interest on that much money.

They're making money on the difference between their interest rate and EFFR. Therefore, no, they aren't rejecting money for that reason because they're profiting from every dollar saved through this; it isn't a charity.

FDIC is a much, much, better explanation.

Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p

#193

Post by throw_nbvc1234 »

tombert wrote: post #177
TradingPlaces wrote: post #171

Earlier quoted context omitted.

They are also illiquid for 3 months. A savings account is for more liquid savings

I could be wrong, but I thought you could sell T-Bills fairly easily on the secondary market. You might take a bit of a haircut, so it's obviously better to hold onto until maturity, but I think in a pinch you can get most of the money back.

Or you can be SVB and take a lot of a haircut. Putting money you "need in a pinch" in an asset where you could take a haircut to get an extra percent or two of interest is a risk. A risk you can mitigate but still a risk.

Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p

#195

Post by rchaud »

__turbobrew__ wrote: post #146
rchaud wrote: post #111

Earlier quoted context omitted.

Good lord. $100k minimum for a 4% yield? In Canada you can get that at any bank with $100 in your account.

Yea I don’t think “any bank” will give you 4%. Just checked CIBC and there are a number of conditions and also the bonus interest only applies for the first 4 months on your first account: https://www.cibc.com/en/special-offers/smart-savings-bonus-i... TD is not even close to offering 4% https://www.td.com/ca/en/personal-banking/products/bank-acco... And RBC only gives higher interest rates for 3 months https://www.r…

I made a mistake, I equated Savings Account with a GIC (which is like a cashable certificate of deposit). In Canada they can both be referred to as a TFSA, or Tax-Free Savings Account.

However the GIC is not like a savings account where there are minimum balance requirements to get an advertised rate.

Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p

#196

Post by jedberg »

unfocused wrote: post #67

In Canada, there are lots of Savings accounts close to 4.5%. Here are examples: https://forums.redflagdeals.com/bank-invsavacct-4-50-real-hi...

Canada is another country with a separate banking system and has a different rate of inflation. Don't be confused just because both currencies are called "dollar".

Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p

#197

Post by throwaway2037 »

cragfar wrote: post #150
hakunin wrote: post #114

So far each new Apple financial product makes me research and re-evaluate my options. When they announced their credit card, I got into "cash back" (thankful that I did), and ended up always getting good percentages back on every purchase. Apple Card was a jumping off point for further research. (For those curious, I ended up with Bank of America Premium Rewards at Platinum Honors tier + Amazon 5% card, Target 5% car…

Fidelity and Vanguard have "core" positions (all money goes into these) that are yielding 4.4-4.7%. They're money market funds so are covered by SIPC insurance. If you're looking to open up something for your kid, might as well just open one up for yourself as well.

You wrote:

    They're money market funds so are covered by SIPC insurance.
If I understand your post correctly, this is not like FDIC insurance. Money market funds can always lose money and are not SPIC insured like FDIC insurance. (Please correct me if wrong.) What does it mean to "lose money" in money market funds? Most money market funds are buying very short-dated debt (about 90 days or less) -- like commercial paper [CP] (very popular before 2008) or US Treasury bills. For CP, these are not principal guaranteed, like US Treasuries (please ignore the Tora-Bora cave dwelling DeFi crowd that worries about the US Federal gov't going bankrupt -- I expect there will be a few replies to this post!). As a result, it is possible for the CP issuer to go bankrupt and be unable to repay the principle borrowed.

I think you are confusing SPIC insurance that covers you if the brokerage firm files for bankruptcy. No matter the losses from a brokerage firm, you will be covered by SPIC insurance as:

    The limit of SIPC protection is $500,000, which includes a $250,000 limit for cash.
To be clear, money market funds are not cash. They are consider securities under US securities laws. You will be covered up to 500K USD. In my personal opinion, they are about 95-98% as safe as US Treasuries -- usually a very good investment.

Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p

#198

Post by chimeracoder »

slg wrote: post #141
58028641 wrote: post #130

Earlier quoted context omitted.

Isn’t Goldman Sachs actually handling that money?

Yes, but it is still Apple's brand on the line. Which of the following has higher odds? 1. GS going under and Apple bails out its customers who hold these accounts. 2. GS going under and the US government bails out everyone. Both are as close to 100% that this conversation is effectively meaningless. I just think it is an interesting hypothetical.

> Both are as close to 100% that this conversation is effectively meaningless. I just think it is an interesting hypothetical.

The first has almost 0% chance of happening. Apple will never bail out its customers for insured deposits, as that money is guaranteed by the FDIC. Why would they effectively "donate" money for free to the FDIC?

The only universe in which that happens is the one in which the FDIC somehow is insolvent and the federal government abandons the FDIC and the cascading effects of the latter (which would almost certainly create a national if not global financial crisis that makes 2008 look quaint) somehow don't affect Apple enough that they could use their additional cash on hand to pay their entire banking liabilities. Which is pretty unlikely, given that most non-banking companies don't have cash reserves that large that they can dip into at a moment's notice. Even Apple, the world's biggest company, has "only" $50B in cash on hand as of last quarter, which sounds like a lot but would not be enough to weather that kind of a crisis and still be able to make depositors whole even if they felt that it was their responsibility.

Re: Apple Card’s new high-yield Savings account is now available, offering a 4.15 p

#200

Post by donohoe »

sosuke wrote: post #16

I feel somewhat confused; my current Wells Fargo saving account APY is 0.01% where did I go wrong? Seems like I might be shifting my money to a new home. Edit: In the very least it will educate many uninformed folks like myself they are getting shafted at their current banks. Double edit: Thank you for all the helpful links and information!

I recommend Ally. Very good customer service (on rare occasions I called immediate pickup or just a few minutes). Their banking app is good (used to be simper/better in the past imho) and they are known for competitive interest rates (Savings is at 3.75% right now)

https://www.ally.com/bank/interest-checking-account/

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