Reserve Accounts

Started by GerryF • 4 replies • 202 views

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GerryF (Ohio)
Posts: 3

Posted:

Curious what bank account solution others have found for their reserve account funds. Do higher interest bearing savings accounts exist for business (vs. personal) customers? Not interested in a CD solution. Needs to be a withdrawal friendly solution with realistic minimum deposit requirement.

TimB4 (Tennessee)
Posts: 21,059

Posted:

We used a money market account

LetA (Nevada)
Posts: 2,679

Posted:

Money Market accounts and a portion of the funds in CD's.
I would suggest 3 at rotating maturity intervals, Strike now while
the iron is hot, high return interest.

CathyA3 (Ohio)
Posts: 6,299

Posted:

You may want to talk to credit unions in your area, because they may offer higher interest rates on deposits. Many also carry insurance that is equivalent to the FDIC insurance offered by banks. But do shop around. There's typically a trade-off in the safety of the deposits and the interest rates they pay - the safer they are, the lower the rates. If something seems out of line with what similar institutions are offering, be suspicious.

MarkM19 (Texas)
Posts: 1,459

Posted:

Gerry,
Not sure how large your community is but from the way you worded your question it must be very small.

Reserve accounts are for long term projects and some short-term expenses. In order to handle the short-term stuff monies should be in cash type accounts with an interest friendly account. The long-term reserves should as LetA mentioned should be in CDs that are laddered so one matures every few months and can roll over if not needed. These are getting great rates these days. They are higher than they have been in probably 20 years.

I am with LetA

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