Help Please! Transfering $ to Make the Most %

[Cheetahwoman7]

Hi Everyone,

My paycheck is direct deposited into my local bank's checking account that makes UNDER 1%. Usually I go into the bank a few days after the check's deposited and transfer about half into my regular savings (.46%, bad, I know), just in case I need it. Pretty much, that's my emergency fund.

When I get what I feel is too much in the regular passbook savings, I transfer it into an account that pays 4.16% and allows additions, but doesn't let me pull the $$ out unless I need $500 or more. You're allowed up to three withdrawls on it over the course of three months before it renews.

From what I've read on these forums, if I'm understanding correctly, places like Ing and Emg. tie into your regular checking and you can EASILY transfer funds from one account to another. I would like to be able to have most of my paycheck transfered to the higher paying account and only pull out what I need into the VERY LOW paying checking account when I'm actually paying off my bills.

There's usually a period of 2 1/2 weeks between when I get my paycheck and when I need a chunk of $$ to pay off bills. I would like to make as much interest off that paycheck as I can.

Can someone please help me figure all this out? It's almost like I'm trying to float the money between two accounts, and get the best return on it. I'm just not sure how to go about it.

Thanks in advance,
CJ

[LuxLiving]

Re: Help Please! Transfering $ to Make the Most %

You could have your direct deposit changed to Emigrant, ING or some other high interest earning online bank, couldn't you?

If not then just set up an online account at the online bank of your choice. Then when you get paid move the money to the online account. Then when it's time to pay bills pull enough back into checking. That's one way of doing it - just remember than online banks usually take 2-3 days to get the money back into your checking and they often have holds on the money that come in as well - each one varies a bit. Inform yourself before you tie up money.

Here's what we do - paychecks are direct deposited into a local money market account which currently pays 4.56%. I have this connected to our checking account at the same bank and I can go online and do immediate transfers there. I pull a months worth of income over to checking on the first to pay bills and move the rest out to Emigrant for greater interest earnings and what I'd call a longer term savings area.

I could move the savings out sooner but just don't as this way it makes bookkeeping and bill paying a one day 30 minute process and otherwise I'd have to do it twice a month. For greater earnings I should be moving it earlier, but have decided the convenience of once a month desk day is worth the small amount of interest I'm losing. CURRENTLY that is, but I've been rethinking this.

[Cheetahwoman7]

Re: Help Please! Transfering $ to Make the Most %

Lux, are any of your bank accounts connected to Emigrant where you can just call or go online and have the excess (hehehe, if that's ever truly the case for anyone) funds transfered, or do you have to go into your bank to have that all done?

Thanks for your help,
CJ

[poundwise]

Re: Help Please! Transfering $ to Make the Most %


First of all, you would need to know if the savings account would allow direct deposit. Many of the online banks only allow deposits by transfer from your linked checking. Some (few) will allow deposits by mail too. I don't know the prevailing rule regarding direct deposits into these online high interest savings accounts.

Secondly, IF you can direct deposit into one, then you could easily set up a transfer from the savings to the checking, though you would need to be aware that there will likely be a period of time, from 24 hours to a few days, when the funds will not be available for transfer. Also, there is a limited time per month that you can transfer FROM an account like this to your checking.

I wonder, can the person/payroll department that handles your direct deposit, split the deposit? That is, if you could direct them to send half to one and half to the other (or some proportion/division) that would be great. I expect that most will not do this but it might not hurt to ask.

What we do, in the case of my wife's direct deposited paycheck, is simply transfer the portion of funds that we have established from our checking to our savings right after the funds are available in checking.

I guess that's basically what many people do, however, as Lux illustrated, there can be better methods depending on your circumstances and setup.

[LuxLiving]

Re: Help Please! Transfering $ to Make the Most %

Lux, are any of your bank accounts connected to Emigrant where you can just call or go online and have the excess (hehehe, if that's ever truly the case for anyone) funds transfered, or do you have to go into your bank to have that all done?

Thanks for your help,
CJ

No, I do it all online. Very rarely actually go into the bank anymore as I get our allowance money out of the bank's atm. In our town our bank is in Walmart and I refuse to go in there as often as I can refuse, sometimes am forced.

Hubster's paycheck direct deposited to MM.

then...

I go online at my local bank and do transfers from the money market to checking for bill pay and vice versa at times - yes it's rarely.

then...

I go online at Emigrant and do a transfer from our checking to make an Emigrant deposit to savings.

[Cheetahwoman7]

Re: Help Please! Transfering $ to Make the Most %

Thanks PW, I was wanting to still direct deposit into my local bank's checking and transfer from there to the online bank's savings, not vice versa. It seems to me that would work out better as I have a fantastic relationship with the manager of my local bank.

So, do you think I could link my local checking to the online bank's savings? Can I then make transfers by phone (I know if I call my bank they will do that for me from one of my accounts to another. Not sure from one bank to another.)

[LuxLiving]

Re: Help Please! Transfering $ to Make the Most %

I'm not PW, but think that you surely could link your local checking to the online world. I'm not sure about the phone transfers, as I do mine all by keyboard anymore!

[poundwise]

Re: Help Please! Transfering $ to Make the Most %

Thanks PW, I was wanting to still direct deposit into my local bank's checking and transfer from there to the online bank's savings, not vice versa. It seems to me that would work out better as I have a fantastic relationship with the manager of my local bank.

So, do you think I could link my local checking to the online bank's savings? Can I then make transfers by phone (I know if I call my bank they will do that for me from one of my accounts to another. Not sure from one bank to another.)

Once you have established a link between the online savings bank and your bank checking account, you can initiate transfers via the online savings bank. This can be manually online, by automatic transfers that you establish ahead of time online, or, in some case, by phone.

(For one, I know that Amboy Direct has a telephone system that lets you call up and initiate a transfer as well as get balance info, transaction history, etc. This is not the norm and you will likely find that many if not most online banks do not let you do transfers except for online. There are some, however. Just ask before establishing the account. Or, go with Amboy click . I set up my parents with them for that very reason and they have been very happy.)

[creditnet]

Re: Help Please! Transfering $ to Make the Most %

Have you considered using any accounting softward to manage your money? I happen to use QuickBooks. By using such a software, you're able to see into your financial future. You'll see what bill will be paid, you can schedule credit card payments, and more. Then, you can see if you'll need money in the future and by what date you'll need the money. Then, schedule an EmigrantDirect transfer to your bank account, and spend the next 2 weeks without worry.

I tend to input my bill pays at least 2 weeks beforehand and try to keep at max $500 in my checking account. All the rest goes into my online savings account. Even if it's for 3 days, I'll send it through to earn 3 days' worth of interest. But remember, it does take 2-3 days for a transfer to be deposited. However, if you schedule the transfer ahead of time, the online bank will take this into account and will often be able to deposit the money into your checking account on the day you have scheduled.