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5 Ways you can beat the highest interest rates

date August 26, 2021 time 8 min read 327 views

One of the biggest benefits of digital technology is the ability to take more control over your finances. As the financial market grows and products diversify, there are more opportunities than ever to boost your investments beyond the highest interest rates on savings accounts.

In this post, we will go through the reasons why the highest savings rates online may not be found in traditional savings accounts and what the alternatives are.

These alternatives are not savings accounts but investments and MyConstant’s P2P lending model is one of them.

Interested? Let’s jump in.

When the highest interest savings rates are not enough

With the average monthly interest rate on savings is currently at 0.06% – and data from Trading Economics putting the current inflation rate at a 13-year high of 5.4%, you’re actually losing money by leaving it in a savings account. This also applies to high-yield savings accounts.

Thanks to the growth of digital technology and the vast amount of information at our disposal today, more people are aware of this trend and are increasingly looking for ways to improve their returns while keeping their risks low and beating the highest interest rates on savings accounts. 

Student, Typing, Keyboard, Text, Woman, Startup
Thanks to the growth of digital technology, more people are looking for ways to improve their returns. (Source: Pixabay)

With investment options expanding with each year, it’s important that you make informed decisions in order to not end up losing your money even when earning the highest interest rates on savings accounts. 

Make sure you read up on these 5 ways you can beat the bank’s highest interest rates for savings before you make that important financial decision. 

5 Ways you can beat the highest savings rates online

Now that you know your money is losing value every single day you have it sitting in the bank, it’s time to explore other options to grow your wealth beyond the highest interest rates on savings accounts.

1. High Dividend Stocks

When most people think about investments and want to invest $10,000 for a quick return, the stock market is the first thing that comes to mind. With good reason too. Since the New York Stock Exchange began operations in 1792, it is one of the best-known and accessible investment markets for everyday individuals.

This brings us to high dividend stocks. 

High dividend stocks are companies that pay out a portion of their earnings to a class of shareholders on a regular basis. 

Instead of trying to earn the highest interest rates on savings accounts, try out high dividend stocks.
Instead of trying to earn the highest interest rates on savings accounts, try out high dividend stocks. (Source: Pixabay)

These companies are usually well established, with stable earnings and a long track record of distributing some of the revenue back to shareholders. 

The distributions known as dividends may be paid out in form of cash or as additional stock and are paid out monthly, quarterly, or annually, depending on the company. High dividend stocks often yield up to 4% and some pay a lot more.

This type of investment involves varying degrees of risk as the stock market tends to be highly volatile, resulting in the fluctuation of dividends and stock value – depending on the performance of the individual stocks and the economy in general.

While there’s a risk of losing some of your money when you invest in the stock market, it can also increase in dividends and value when the stocks perform better over time.

Stock Market, Charts, Graphs, Finance, Money, Stocks
Stock market charts graphs finance. (Source: Pixabay)

Either way, it is one of the more reliable and traditional ways to beat the highest interest rates on any savings accounts.

You can invest in high dividend stocks by purchasing individual dividend stocks or through mutual funds, such as index-funds or exchange-traded funds (ETF).

It’s wiser to diversify your investment through mutual funds because it offers you access to a selection of dividend stocks within a single investment. With a diversified portfolio, your fund is broadly invested across multiple market sectors, assets, and regions. This prevents a collapse in one sector from affecting your entire portfolio.

2. Real Estate Investment Trusts (REITs)

Real Estate Investment Trusts (REITs) are investment trusts that invest in income-producing commercial real estate, like multi-family rental apartment buildings, shopping malls, and office buildings. There are different types of REITs, like retail, residential, healthcare, office, and mortgage REITs.

You don’t need to buy a whole house to invest in real estate.
You don’t need to buy a whole house to invest in real estate. (Source: Pixabay)

REITs are considered one of the great investments to beat the highest interest rates on savings accounts, because they provide greater diversification, potentially higher total returns, and lower overall risk. With an historical return of about 10%, anybody serious about building a solid investment portfolio needs to consider REITs.

Real estate is considered to be a safe bet due to its historically appreciative nature but there are regional variations in the U.S. It’s always a good idea to consult an experienced real estate investor or consultant when deciding which properties to invest in.

3. Peer-to-Peer (P2P) Lending

Here at MyConstant, we offer peer-to-peer lending investments, which enables you to earn up to 7% APR for a six-month term. As one of the leading providers of crypto-backed loans, our products offer a high degree of flexibility, including an instant-access account where you can withdraw at any time.

Intrigued? Here’s a bit more about peer-to-peer lending sites and how they can give you the highest interest rates for your savings.

P2P lending is a process of lending and borrowing that takes place without the use of traditional banks. Borrowers and lenders converge and transact directly on various peer-to-peer lending platforms, effectively cutting out the middleman.

Peer-to-peer Lending (P2P Lending) | Peer-to-peer Lending (P… | Flickr
Peer to peer lending is one of most popular alternatives to the highest interest rates on savings accounts. (Source: Flickr)

P2P lending for bad credit became more popular in the United States during the financial meltdown of 2008, when getting loans from banks became increasingly difficult.

MyConstant took the concept and merged it with the other big emerging trend of the last decade – cryptocurrency. Instead of checking the borrower’s credit history, we simply take their crypto as collateral. We now support over 70 cryptocurrencies and that list is always growing.

The terms of the loans can be set by you. The longer you leave the loan with us, the higher interest you will earn. That’s the reason why P2P lending is one of the ways you can try to beat the highest interest rates on savings accounts. 

Peer to peer lending is one of most popular alternatives to the highest interest rates on savings accounts.
Peer to peer lending is one of most popular alternatives to the highest interest rates on savings accounts. (Source: MyConstant)

For crypto-backed loans, the rate starts at 6% APR for 30 days, rising to 6.5% APR for 90 days, and 7% for 180 days. By playing it smart, you can also ensure your earn compounding interest rates, which will boost your returns even more.

Another key benefit of MyConstant is the fact you can start investing from as little as $10, with no upper limit. With our easy-to-use platform, you can get started with MyConstant straight away once you’ve passed our KYC verification process.

And here’s one more thing: Since our launch in 2019, none of our investors have lost their principal – a record we are striving to keep.

4. US Treasury Securities

US Treasury securities are debt obligations issued by the Department of Treasury and are considered one of the safest investments because they’re backed by the U.S. government. 

You’re lending money to the U.S government and it’s highly unlikely that the government will default and be unable to pay back your principal and interest.

US Securities are backed by the full weight of the US government, so as far as investments go, this is one of the safest. (Source: Go Banking Rates)

The three main types of treasury securities are:

  • Treasury bills: Short-term securities, matures between one month and one year.
  • Treasury notes: Mid-term securities, matures between two years and 10 years.
  • Treasury bonds: Long-term securities, matures between 20 and 30 years.

The types of treasury securities are differentiated by the terms of instrument and interest rates.

While treasury securities offer relatively low returns of up to 2.7% and may not protect you from the current rate of inflation, it’s worth noting that treasury securities are safe, can be liquidated at any time, and the interest they pay is exempt from state income tax.

Also, while the current interest rate might not match the inflation rate, this has not always been the case and rates may increase when the economy recovers.

5. Cryptocurrency

Since the creation of Bitcoin in 2008, cryptocurrency has been a hot and controversial topic globally. With as many critics as there are enthusiasts, this doesn’t look like it’ll change anytime soon. No matter which side of the divide you fall on, there’s no denying that cryptocurrency has made a big impact on financial institutions around the world.

Crypto is a risky alternative but it can beat the highest interest rates on savings accounts. (Source: Pixabay)

With its high volatility, one thing you must bear in mind if you plan to invest in cryptocurrency is that it’s a high risk, high reward investment. You must assess your appetite for investment risk and ensure that you have your finances in order before venturing into it.

Creating a strong financial foundation and learning everything you need to know about cryptocurrency before putting your money into it is the best step you can take to know if this is a journey you would like to embark on.

Now that the gloomy stuff’s out of the way, if you are someone who likes the excitement of price fluctuations, investing in cryptocurrency can both be exhilarating and rewarding. With bitcoin’s volatile price jumps and slumps over the years, you have the opportunity to get huge returns on your investment if you strike at the right time.

Bitcoin, Btc, Cryptocurrency, Cryptography, Cryptomoney
Crypto is a risky alternative but it can beat the highest interest rates on savings accounts. (Source: Pixabay)

Apart from the limitless possibilities on returns that cryptocurrency investments offer, its liquidity is another reason you should consider investing in it to beat the highest interest rates on savings accounts. Unlike other types of investments that require going through various institutions and intermediaries in order to liquidate your investment when you need to, cryptocurrency lets you sell your coins fast and easily.

Invest to save more

Now that you know five ways you can invest your money wisely and beat the highest savings rates on savings accounts, you need to understand that the key to building wealth is to accept risk as a fact of life and invest accordingly.

No high reward investment is as safe as leaving your money sitting idly in your savings account, but with the risks also come the possibilities of great rewards and opportunities to put your money to work for you.
Remember, when it comes to investments, the importance of diversification as a safety net cannot be overemphasized – especially for beginner investors.

Also, with our proven track record in returning strong interest rates, low barrier of entry, and high interest rates within short tenures, P2P lending can be an integral part of a strong investment portfolio. You definitely can earn interest on your cryptos with MyConstant.

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George Schooling

George Schooling

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