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In an ideal world, we would all find a way to make our money that is sitting in our banks work for us rather than, well, just sit there. One of the ways we can do that is by placing our money in accounts that offer a decent Annual Percentage Yield (APY), also known as interest. The average savings account is 0.06% which, needless to say, isn't very high. Some of the best interest rates in banks or financial institutions hover around the 1% mark, which is still not a huge percentage but does make a significant difference when broken down. Take, for example, $10,000 in an account that offers 1% APY. Over the course of the year, it will earn $100 for you rather than just $1 if it was only at 0.01% APY. Here are a few different ideas to help your money start making money.

Certificates of Deposit

One idea is to invest money in Certificates of Deposit (CD). They offer much higher interest rates than Savings Accounts but the catch is you won't be able to access the money for a set period of time which is predetermined by you. This could be anywhere from six months, which would offer a lower APY, to a much longer term such as five years which, you guessed it, has a much higher APY. If you do need to access the money before the set time period is completed, you will have to pay an early withdrawal fee which often defeats the purpose of the CD, so make sure you can financially set aside the money for the designated length of time before locking it up in a CD. More banks are also offering a CD ladder which allows you to divide the money into smaller chunks and put them in several CDs with varying term lengths. The idea is that you can then reinvest them once their term has expired.

Another bank account option with decent interest rates is a high-yield checking account. Often banks will offer free checking accounts with low monthly maintenance fees and decent interest rates but you might have to keep a close eye on this type of account. Some banks will have terms and conditions that require you to set up direct deposit, have a minimum number of times in a cycle that the debit card needs to be used or require online bill pay. If these terms aren't met, they may very well slap on a fee which will take away all your hard earned interest.

Credit Union

While large traditional banks are convenient in that they have branches at every street corner and everyone knows them by name, bigger doesn't always mean better. Smaller financial institutions are well worth researching. Small credit unions often have higher interest rates on savings accounts, CDs and money market accounts. But in order to get one of these accounts, you need to be a member which can be decided by your job and where they are located. Some employers sponsor their own credit union, while others only include people who live or work in the area. If you have a family member who is already part of a Credit Union, they may very well allow you to join.

Online Banks

Another option for finding the best interest rates are online banks. Some people may still be skeptical about online banks and prefer to talk to people face to face when dealing with their money, but times are changing and online banking, in general, is becoming increasingly popular. Since these online banks do not have to pay for branches and tellers, they can afford to offer higher interest rates, often paying more than 1% APY. Just make sure that the bank is a member of Federal Deposit Insurance Corporation (FDIC), which would mean your deposits up to a quarter of a million are insured by the government.

Read the Fine Print

Whether you decide to put your money in a Savings Account or CD with a traditional bank, or invest it with a Credit Union or Online Bank, there are a few things to consider. Read the fine print and see if there is a minimum deposit that needs to be made or a fee that will be required if it drops below a certain amount. Some accounts have monthly withdrawal allowances or maybe even a hidden monthly fee. Banks, though, may also have other options that could be to your benefit if you are looking to invest a large sum of money. Some financial institutions may offer higher bonus rates to for accounts that deposit $50,000 or more within the first six months of opening the account. Whatever you decide, make sure you have invested time into researching the account that suits your needs and fits your budget.