Korean Job Discussion Forums

[chaz47]

I want to set up a new account back home where my money works for me, that way if I am lucky enough to reconsolidate my student loans at a low enough rate the rest of my money can be earning more interest in a savings or checking account.

Unfortunately I really have no idea how to do this. Another poster here on Dave's has done a similar thing but I can't find the thread so I thought I'd bring up the topic again.

[Octavius Hite]

What country are you from?

[chaz47]

US

[paytonfan86]

First post, long time lurker

There are high interest savings accounts you can set up online (BofA), but the highest APR you'll get is around 6% and then only with a very high minimum balance (often 25K or higher). That's about the same APR as a lot of student loans. Generally, you'll do worse in the interest game by delaying student loan payments and sticking money in a savings account.

You can open an index fund (recommended) or mutual fund (better than savings) and likely earn more interest than you're paying on student loans. You sacrifice liquidity this way, but there's a much bigger long-term gain. That's how you get your money to work for you.

[waltjocketty]

I opened a money market account through Fidelity Investments, which is essentially a checking account which gets me 5% interest. I think you have to have $2500 or more to open the account, but I'm not positive. It's totally free and it sounds like what you're looking for.

[chaz47]

I found this site last night.

http://www.consumerismcommentary.com/rates

Am I missing something here? UFB Direct seems to be offering a pretty good deal.

[chaz47]

Can someone explain HSBC Direct to me? They exist in the ROK and the US, this seems like a potentially good thing for a US citizen like myself.

[waltjocketty]

HSBC is basically the same as the fidelity thing I mentioned previously...you open a checking account and link it to another account of yours, and they invest your $ and give you about 5% interest on whatever you have in your account. The only reason I mentioned Fidelity instead is because you have more options of how you want your account managed, and you can invest the $ in the Fidelity account in Fidelity mutual funds and stocks and bonds, whereas I don't think you can do that with HSBC. Why don't you go into a bank and talk to someone, or make a Skype call to a big investment firm and ask them the questions you want answered. If you wanna put your $ in an account without risking losing $, and you want to make a bit of profit, money markets are the way to go. If you don't mind not having access to the $ for a while, maybe a CD is the way to go, and if you don't need access to it and want a little more interest, check out some mutual funds.

[paytonfan86]

Money Market accounts can return a fair interest rate and you maintain liquidity. However, the OP stated that he wanted to reconsolidate his loans at a rate lower than whatever APR earned from an interest-bearing account. Variable rates (bad idea) may start as low as 2.5%, but fixed rates start around 4.75%. If the Money Market account earns 5%, you're only ahead .25%. That doesn't even keep up with inflation. You actually lose money that way.

If you're only concerned with the short-term gain, Money Market is your best bet. You'll essentially break even. If you want long-term gain, a mutual fund (preferably index) will likely net you the most.

[RJjr]

[Sine qua non]

[chaz47]

I just got an approval from these guys:

http://www.ufbdirect.com/ufbdirect/

5.31%

Is there a catch that I'm not seeing?

[chaz47]