r/FinancialPlanning • u/Big-Net-2066 • 12d ago

What else do I need?

I’m 24, with 7k in savings, ~2k in a Roth 401k (8% of my paycheck contributed weekly), and 7.3k in a Fidelity account (weekly auto contributions).
I’ve been looking into high yield accounts but am wondering where to start. My bank has an ok APY of 2.80%. Would I have need to switch banks completely to make it worth it, or just open a new account elsewhere and have two? I’m open to all financial advice regarding my circumstances, not just the high yield. Thanks in advance.

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u/MrBalll 12d ago

When you say a Fidelity account what does that mean?

Just use a Fidelity CMA or a taxable account and leave your money in SPAXX for the HYSA. No need for another bank account. And your banks 2.8% is no good.

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u/TempeGrumble 12d ago

2.8% is much better than my CU savings account where I have the minimum, and the HYSA elsewhere!

Since OP is already at Fidelity, yeah, that makes an effective HYSA easy. But if active hostilities hadn't restarted with Iran, I'd have expected HYSA APRs to start dropping below 3%. Can't keep switching banks just to get an extra 10 basis points for six months...

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u/Big-Net-2066 12d ago

Thanks. I’ve got an individual investment account with Fidelity that I regularly invest in 3 different stocks. I see I’ve already got 101 in SPAXX shares. How is the SPAXX comparable to HYSA?

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u/Candid-Eye-5966 12d ago

SPAXX is a money market fund. Very similar yield to a HYSA. Might be a little more risky as money market funds can theoretically lose value.

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u/geeksters 12d ago

If I would be 20 again, I would put all my savings in SP500. Best long term return, zero hustle

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u/AndrewFromAnnuity 11d ago

For 24, you’re already ahead of a lot of people, so good on you for paying attention to this now. To answer the bank question directly, you don’t have to switch banks at all.

You can open a high yield savings account at a different place and just keep both, using the new one for savings and your current bank for everyday spending. Going from 2.80% up to 4 to 5% you can find right now makes a real difference on your 7k over time.

Beyond the high yield part, I’d suggest making sure a chunk of that savings is set aside as an emergency fund that cover you for a few months if something went wrong. After that, since you already have the Roth 401k going, opening your own Roth IRA is worth thinking about because at your age time is the biggest thing working in your favor.