Record High Personal Saving Demands, Near-Zero Yields: Americans Need a Better Way to Save

Couple reviewing Save investment returns

The COVID-19 crisis has reminded every American of the importance of having some cash savings in the bank. Millions of Americans are more worried than ever about their financial future and are scrambling to save more money. But what if those bank savings accounts aren’t paying any interest? What are savers supposed to do if saving doesn’t pay?

According to recent data from the Federal Reserve, as of June 2020 the U.S. personal saving rate is now at 19%, a historical high. Americans are clearly looking to save as much money as they can during uncertain economic times. Unfortunately for these savers, bank savings accounts are paying near-zero yields. Even so-called “high yield” online savings accounts and CDs are paying APY rates in the range of 1.30-1.50%.

What are savers supposed to do? There has to be a better way to save. There has to be a better choice other than “risk your savings in the volatile stock market” or “earn near zero interest in a bank account.”

Introducing: Save

The better way to save is here. It’s not just a savings account, it’s a savetech platform that helps people maximize their savings.

Save was created by a team of financial industry veterans, quantitative experts, investment managers and data scientists. Our goal is to offer a better way for people to manage their savings.

Just as the robo-advisor category has emerged in recent years to give individual investors more options and flexibility for how to manage their retirement savings and stock market portfolios, Save intends to create a new category of personal finance as the world’s first “robo-advisor for savings.”

What is a “Savetech” Platform and “Robo-advisor for Savings?”

Save is not a typical savings account: it’s a comprehensive “savetech” platform – an FDIC-insured savings account that lets savers earn the potential upside of market investments.

How does it work?

Our savetech platform has a few components:

  • Market Savings Account: When you sign up for a Save account, your deposits are placed in an FDIC-insured Market Savings Account through our banking partnership. You can withdraw your deposits at any time and your money is fully FDIC-insured to the same extent as a typical bank savings account or CD.
  • Interest Invested in Market Portfolio: However, instead of having to settle for the small amount of near-zero interest that a bank savings account would pay, Save invests your interest in our diversified portfolio of investments (stocks, bonds, cash, some commodities and real estate). The portfolio is optimized with technology with the goal of delivering stable returns. Based on hypothetical back-tested performance, we expect that our portfolio can deliver average annual returns of 3.15%**.
  • The Save referral program: Save makes saving social. Whenever a Save customer refers a friend or family member to open a Save account, they will each receive a bonus of $1,000 of equivalent portfolio investments; this can help boost your investment returns significantly. This referral program is designed to be exceptionally generous and have strong upside potential for customers returns. Most institutions might give you a free toaster for referring a new customer; we give you measurable gains in terms of actual returns.
  • Everyday spending rewards: Save also offers a debit card linked to your Save account where you can earn additional rewards of the equivalent of $1 of additional portfolio investments for every $1 spent. So if you spend $10,000 per year on your Save Debit Invest card, your Market Savings Account will be credited with the equivalent return for an extra $10,000 of savings.
Low Fee “Savings Advisor”

You might be wondering: if Save can promise such a compelling returns, how much are the fees? The answer: our fee is only 35 basis points (0.35%) – and we only charge the fee if the portfolio delivers a return greater than the fee. Unlike many other investment managers, Save only makes money if we succeed at making money for you.

We serve as a “savings advisor” to our customers. We invest their money responsibly with sophisticated investments, optimized with financial technology and targeted for their savings goals, but we only make money when our customers make money. And our customers have no risk of losing their initial deposits, which are FDIC-insured through our banking partnerships.

With Save, you get the safety net of FDIC-insured deposits, and the upside of an entrepreneurial fintech “savings advisor” that smartly manages your savings yield to help your savings grow faster with market investments.

How Liquid is Your Save Account?

Save offers similar liquidity to a bank savings account: you can withdraw your deposits from Save at any time, but you have to leave your deposits with us for 12 months to earn a yield. We require customers to make a minimum 12-month commitment to earn a yield, based on the costs of investing/managing the portfolio assets.

What is in the Save Market Investment Portfolio?

Save is a savings advisor, so we help customize your portfolio based on your risk tolerance and savings goals. But in general, we invest our customers’ savings yields in a diversified portfolio of cash equivalents, U.S. and international stocks, bonds, U.S. Treasuries, emerging markets, commodities, and real estate.

The goal of our portfolio: deliver stable returns with short-term upside, but with a higher yield than any savings account or CD can achieve.

Until now, this type of tech-driven investment has mainly been available only to institutional investors or sophisticated high-net worth investors. We want to democratize these investments and make them available to the U.S. consumer market.

The moment is right for innovation in the personal savings space. No other company is offering this combination of FDIC-insured deposits and market-driven upside. At a time when the stock market is volatile and bank accounts are paying nearly nothing, our fintech “savetech” platform is reinventing the idea of what it means to make your savings grow. We believe this will be a new category of personal finance that will open up new growth opportunities for potentially millions of everyday savers and investors.

Tired of zero-interest bank accounts? Want a better place to put your savings? Sign up for Save.

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