Why do only online banks offer this? If the rate is 6% and you put in 100k, then does it stay 6% for as long as you have the money in there….even if it’s years? How safe is this and why aren’t more people doing it.
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>Why do only online banks offer this?
Because they can make more by lending out what you deposit, and furthermore because they can lend a certain amount more (x times as much) than they have in deposits.
>does it stay 6% for as long as you have the money in there
No. It’s based off current interest rates.
>How safe is this and why aren’t more people doing it.
I have no idea how prevalent it is, or how much people actually know about it. I do know most households live paycheck to paycheck, so that is going to cut down on it’s usefulness.
It’s as safe as any deposit. And in the US it’s insured with the FDIC, so as safe as the government existing I guess.
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