Let’s talk about everyone’s favorite topic - money. Better yet, let’s talk about savings and the age-old question how much of your income should you save?
In this piece, I will break down what you need to know about saving money.
And more. I also have a list of the eight best savings accounts right now that you can use. Plus, ten of the best options to invest your money.
Because yes, it’s not enough to save it. You also have to make your money work for you. So, let’s get started!

How Much of Your Income Should You Save?
Before we get into the numbers, statistics, and the savings percentage of income, you need to understand a few basic things.
First of all, always remember that saving money is a highly personalized concept.
What does that mean?
It means that saving money is different for everyone. In other words, there is no formula that applies to every single person in the same way.
Some people save to buy a car, others to buy a house, others to have a child, while even more simply to afford a weekend trip to Paris.
Secondly, saving money depends on your income.
This means that every person should save exactly as much as they afford to, not a general percentage.
Thirdly, saving money is not a race!
As a result, if you feel like you’re falling behind or that you can’t keep up, that’s fine! Not everyone can save a few million dollars by the time they have reached retirement age.
Also, not everyone can save for a luxury car or for a mansion. It’s important to reach your goals but it’s also important not to overreach your budget.
So, what is the best way to do it? What percentage of my income should I save?
Experts advise that you should save money according to your age. Here is an example.
And because it’s always fun to look at what others are doing, let’s check out this analysis breakdown that Bankrate.com did in 2016. They did a Survey of Consumer Finances using data from the Federal Reserve (of the United States).

While I do advise you to read through the entire survey and analysis if you are interested in saving money, there are some very interesting things to take away from it.
For example, the survey has found that people over the age of 75 save the most money. If they are single and have no children, they are able to save over $18,000 and if they do have children, they save a little over $17,000. While couples over 75 save a lot of money across the board. A whopping $21,500 if they do not have any children.
Here are the people who save the least amount of money, according to the analysis. Single individuals with children between the ages of 35 and 44. They can scrape up a little over $2,000.
Interestingly enough, they are followed closely by single people without children under the age of 35. They can save $4,000.
So? Who are the ones who save the most?
According to the study, it’s couples with children between the ages of 55 and 64. They bring in almost $41,000 just in savings!
So, if you’re wondering what is a good savings rate, you’re looking at it.
This goes to show you exactly what I was saying above. That saving money is not a race and that it depends on your age!
So, now that you know how to save money and when you will be saving the most, let’s talk about where you should be saving it.
8 Best Savings Accounts that Yield Great Savings Rates
Before we get into the savings rates themselves and the average savings per month tips, a few clarifications are in order.
The savings accounts you are about to see here are the best at the moment of writing this article.
Banks and financial institutions may change their terms and savings rates, which might affect the ratings.
Inflation can also affect how these savings accounts perform as time goes by.
1. Varo Savings Account
The first savings account on our list gets five stars. The reasons are very simple as you are about to see.
The savings account offered to you by Varo Bank will not charge you any monthly fees and does not require a minimum balance.
This is great news if you’re planning on keeping your savings with them.
They also offer a great APY of 0.20% at the moment of writing this article.
The Varo account has a special feature called the Varo Advance Feature which you can use to get as much as $100 in the form of an instant cash loan.
This will come in handy if you really need some hard cash and you simply cannot get it elsewhere.
As usual, there are a few drawbacks as well. If you want the highest APY, you will need to meet their requirements. At the same time, they charge extra fees and impose limits on cash deposits.
2. Alliant Credit Union High-Rate Savings
Yet another savings account that I’ve rated five stars based on the reviews left by people who are already using it.
The Alliant Credit Union savings account has a whopping 0.55% APY. But, be aware that you will need a minimum balance of $100 to qualify for it.
Alliant Credit also offers 0.25% APY on their High Rate Checking. You will find that this APY is also higher than most other banks.
They manage a vast network of over 80,000 ATMs all over the country, which means that you will have easy access to your money whenever you need it.
The drawbacks to this savings account are as follows. They charge a $28 overdraft fee. Plus, there is absolutely no limit on the number of daily charges, so you need to watch out.
At the same time, the bank will not participate in what we call shared branching.
3. Marcus by Goldman Sachs Online Savings Account
The savings account that takes third place on our list gets four and a half stars. I’m quite sure that you have already heard of Goldman Sachs, one of the main titans of the finance world.
Their celebrity status means that you can also trust this bank with your savings. So, what else do they bring to the table?
First of all, the most important thing you need to know is that Marcus by Goldman Sachs offers a great APY. It’s 0.50% with absolutely no minimum balance. Since the national average savings rate in America is 0.06%, you can see how their offer is pretty much fantastic.
They also offer transfers on the same day as long as you keep the sum within a $100, 000 limit. If you want, Marcus by Goldman Sachs also has a great range of CD rates and savings that are super competitive.
So, what are the downsides of this savings account?
The most important thing you need to be aware of is that you will need an external and separate account if you want to make transfers into your savings account.
At the same time, the bank does not have an ATM network, nor do they provide you with a checking account.
4. Comenity Direct High Yield Savings Account
Here is a savings account that has garnered no less than four stars thanks to the great reviews from people who are already using it.
As their name suggests, Comenity Direct does indeed offer a high yield savings account.
The APY is no less than 0.55%.
They do not operate monthly fees for their savings account or for their CDs if that is an additional service you are interested in.
Users report that Comenity Direct’s online services are great, which means that you can do all your banking online or simply by using your phone.
This is great news for people who have a busy lifestyle or for young people who are interested in saving money.
When it comes to the downsides of this savings account, Comenity Direct does not offer a checking account. At the same time, they will require a minimum if you want to open a CD and that minimum balance is very high.
5. American Express High Yield Savings Account
Who hasn’t heard of American Express? Their high yield savings account is one of the best at the moment of writing this article.
The bank offers a great APY of 0.40% with no minimum balance required. They will also not charge you any additional fees on a monthly basis.
However, as usual, there are a few things you need to keep in mind if you want to start an account with American Express National Bank.
For example, they do not have an option that allows you to open a checking account.
In the same way, the bank will not allow you to deposit cash. Therefore, you can only make money transfers between two or more accounts.
You must also keep in mind that American Express does not have any mobile apps.
As a result, if you like to bank on your mobile phone, this might not be the savings account for you.
6. Ally Bank Online Savings Account
Ally Bank is a favorite among many users, which is why I have awarded it four stars on our list.
They offer one of the best APY rates on the market. It’s 0.50% with no minimum balance. And there are more benefits.
Ally Bank does not operate any kind of maintenance fees for their savings accounts, checking accounts, or for their CDs. Therefore, you can branch out your financial portfolio and use more of their services.
The bank also has a very strong ATM network all over the country. They offer over 43,000 ATMs which are free to use whenever you need to access your money. This is what gives you financial freedom.
So, are there any drawbacks to opening a savings account with Ally Bank?
Yes. There is the fact that the bank does not allow you to deposit cash in any way.
At the same time, you need to know that Ally Bank is not a traditional financial institution. This means that it does not have any physical locations.
Therefore, you will not be able to solve any issues that might occur in any other way than via phone, email, or chat.
7. Live Oak Bank High Yield Online Savings
If you’re interested in a high APY, Live Oak Bank can offer you exactly that.
Their interest rate is a whopping 0.50% with no minimum balance. As usual, they will not charge you any monthly fees. This is one of the reasons why I chose Live Oak Bank for our list of the best savings accounts.
However, since this is an honest review of these savings accounts and I want you to have the best information, here are some things you also need to know.
If you want to open a CD with Live Oak Bank as well, they will charge you a high minimum deposit of $2,500. Plus, the bank does not allow any cash deposits at all.
Another important thing to keep in mind is that the bank only has one physical location. As a result, if you don’t live in that area or even in the state, you will find it difficult to visit them. If you prefer to bank in person that is.
8. Barclays Online Savings Account
The last entry on our list of the best savings accounts is none other than the world-famous Barclays Bank.
However, you will notice that I rated it four stars instead of five.
The reason is that they offer a slightly lower APY than some of the other banks and their savings accounts on the list.
Barclay’s APY is 0.40%. Still, it is very competitive if you think about the national average APY. The bank does not require a minimum opening deposit for the savings account or for its CDs.
At the same time, their fee for insufficient funds in your savings account is much lower than with most banks.
Barclay’s only charges you $5 while most other banks and financial institutions charge $30.
Be aware that Barclay’s does not have an ATM network nor does it operate any branches at the current moment.
They also don’t offer a checking account and they will not allow you to deposit cash.
In the same way, you will not be able to make withdrawals from their ATMs.
10 Best Places to Invest Your Savings
I know you’ve heard of the phrase make your money work for you. This is exactly what we’re about to discuss.
The 10 best options you have for investing your savings right now.
1. High-yield savings accounts
You knew this was the first on the list. After all, this is what we’ve been talking about so far. So, naturally, the best option you have for your savings is still the savings account.
The reason why it’s such a good idea is that, as you can see above, all the savings accounts I have chosen for you have a great APY.
Plus, they are super low-risk and allow you easy access to your money whenever you need it.
2. Certificates of deposit
Also known as CDs in the financial world, Certificates of Deposit tend to have higher saving rates than saving accounts.
However, they also come with a maturity date which can vary in length between several weeks to a few years.
In other words, you will not be able to access your money within this time frame. That is why CDs are usually a good choice for older people who have already retired.
3. Government bond funds
These types of investments are ETFs or mutual funds. They will invest in what we call debt securities which have been issued by the US Government or by its agencies.
A few examples of the debt instruments the funds invest in are T-notes, T-bills, or T-bonds.
What you need to know is that the government bond funds are great because they present a low risk. As a result, they will come in handy if you are a beginner investor.
4. S&P 500 index funds
Now we’re talking about the big league. These traditional banking bonds and products may yield higher returns. But they are also far more volatile than other options.
As the name indicates, the fund is made up of largely the biggest 500 companies and corporations in America. This includes Berkshire Hathaway, Amazon, and the like.
Therefore, you can invest in them as a way to diversify your portfolio.
5. Short-term corporate bond funds
There are certain times when corporations need to raise money. They do so by delivering bonds to their investors which are then packaged into bond funds.
They are called short-term because they have a small maturity rate of up to five years. This is a good thing. In this way, the bonds are less susceptible to fluctuate as the market goes up and down.
If you are looking for a certain cash flow as an investor, then this might be the choice for you.
6. Nasdaq-100 index funds
This is the perfect choice for an investor who wants a door open to the largest and greatest tech companies in the world. But without you having to analyze the market and see who is the winner and who is the loser of the bunch.
Nasdaq 100 has already done that for you. The companies they feature are stable and successful.
Evidently, they include Microsoft, Facebook, and Apple.
As a result, based on the indications of the Nasdaq 100, you can diversify your portfolio and not risk exposing yourself to failure if one of these companies goes under. Which they won’t. I mean, let’s be honest.
Do you see Apple going under any time soon?
7. Dividend stock funds
This is an option perfect for investors who are at an intermediate or even advanced level.
Stocks that pay dividends are great because they are not as risky as other options and because they can pay you very well.
However, you still need a bit of experience to choose properly.
8. Rental housing
Evidently, investing in property is a great way to make money.
However, you will have to put in the work of managing the properties themselves.
At the same time, you need to have some expertise in choosing the right properties that will make you money.
9. Municipal bond funds
They are also called munis and are a type of bond issued by your local government or by the state.
The great thing about them is that the interest you make off them will not be taxed.
As a result, this is a great option for people who want to invest in high tax brackets or if you live in a high-tax state.
10. Cryptocurrency
I know you have been seeing this all over social media lately.
BitCoin, of course, is the main digital coin at the moment and it’s a hot one at that. However, you need to understand two things.
Its price fluctuates severely. This means that you can make a lot of money. But also, if you lose, you will lose an insane amount of money.
And secondly, BitCoin does not have the backup of FDIC. In other words, it is only worth as much as those who trade it are willing to pay you for it.
What’s the conclusion?
We have reached the end of our guide on how to save money.
Now you know how much of your income should you save and what are the best savings accounts.
But you also have a list of the best places to invest your savings so that you can make your money work for you!