Question

use the account features to match the cons (disadvantages) of each savings option.
basic savings account (brick & mortar banks)
account features
minimum deposit $25
liquidity
(access to your account) limited transfers of atms, no debit card
security fdic insurance up to the maximum amount allowed by the
law
fees $5 per month unless you have over $300 daily balance
current rates 0.5% apy
variable interest rate (may change over time)
online savings accounts
account features
minimum deposit $0
liquidity
(access to your account) limited to 6 withdrawals per month
security fdic insurance up to the maximum amount allowed by the
law
fees none with the exception of $3.00 fee for each outgoing wire
transfer
current rates 3.90% apy
variable interest rate (may change over time)
high yield savings accounts (hysa)
account features
minimum deposit $2,500 to open but no minimum balance
liquidity
(access to your account) online, mobile, over the phone and at atms.
you can spend money using debit cards & checks
security fdic insurance up to the maximum amount allowed by the
law
fees none
current rates balances below $100,000: 3.8% apy
balances $100,000+: 4.0% apy
variable interest rate (may change over time)
certificate of deposits (cds)
account features
minimum deposit $2,500
liquidity
(access to your account) one deposit then you cant touch the account until the end of
its term
security fdic insurance up to the maximum amount allowed by the
law
fees none but stiff penalties for early withdrawal
current rates 3 - month: 2.60% apy 1 - year: 4.32% apy
6 - month: 3.21% apy 2 - year: 4.39% apy
9 - month: 3.73% apy 5 - year: 4.39% apy
18 - month: 4.73% apy 10 - year: 3.8% apy
30 - month: 4.30% apy fixed interest rates for term
high minimum deposit and balance
requirements. you may pay fees or earn
less interest if your balance drops below the
minimum requirement
high minimum deposit and your money is
illiquid, so you wont be able to access your
money without penalties.
no debit card and low - interest rate means
slower growth.
no physical location and variable interest
rates. if rates decrease your money may not
grow as fast as expected.

basic savings account online savings account high yield savings account
certificate of deposit

Explanation:

Step1: Analyze Basic Savings Account

Check its features: minimum deposit $25$, no debit card, variable interest rate. The con “No debit card and low - interest rate means slower growth” matches as it has no debit card and variable (which can be low) interest rate.

Step2: Analyze Online Savings Account

Features: no physical location (online), variable interest rate. The con “No physical location and variable interest rates. If rates decrease your money may not grow as fast as expected.” matches.

Step3: Analyze High Yield Savings Account

Features: high minimum deposit ($2,500$ to open), but no mention of illiquidity penalty. The con “High minimum deposit and balance requirements. You may pay fees or earn less interest if your balance drops below the minimum requirement” matches as it has a high minimum deposit and balance - related interest rules.

Step4: Analyze Certificate of Deposit

Features: high minimum deposit ($2,500$), illiquid (can't touch until term end, early withdrawal penalties). The con “High Minimum Deposit and your money is illiquid, so you won't be able to access your money without penalties.” matches.

Answer:

• “No debit card and low - interest rate means slower growth.”: Basic Savings Account
• “No physical location and variable interest rates. If rates decrease your money may not grow as fast as expected.”: Online Savings Account
• “High minimum deposit and balance requirements. You may pay fees or earn less interest if your balance drops below the minimum requirement”: High Yield Savings Account
• “High Minimum Deposit and your money is illiquid, so you won't be able to access your money without penalties.”: Certificate of Deposit