When you hear the words “passive income,” you probably think of real estate, stocks, or starting a business. But what if I told you that you could start earning money passively just by parking your cash in the right place? While this might not seem or feel exciting, I believe there are certain benefits to letting some of your money sit and grow interest over time. Enter high-yield savings accounts (HYSAs)—one of the simplest ways to make your money work for you. Unlike a regular savings account that offers minimal interest (think 0.01%—basically nothing), a high-yield savings account can offer 4% or more in interest, meaning your money grows without you having to lift a finger. And if you’re an athlete—whether in college, professional, or recently retired—having your cash in a high-yield savings account can be a game-changer. Let’s break down why.
What Is a High-Yield Savings Account?
A high-yield savings account is just like your regular savings account but with a much higher interest rate. It’s typically offered by online banks, credit unions, and some traditional banks. The difference? They offer 10-20x the interest of a normal savings account, meaning your money grows faster over time.
For example, If you put $1,000 into a regular savings account with 0.01% interest, you’d earn $0.10 in a year. But if that same $1,000 was in an HYSA with a 4% interest rate, you’d earn $40 in a year—just for keeping your money there. Now imagine if you had $10,000 or more?
Why Should Athletes Care?
Many athletes are focused on earning money through NIL deals, contracts, or side hustles, but what happens to that money after you earn it? Keeping your cash in a low-interest savings account is like leaving money on the table. Here’s why an HYSA can work for you:
- Short-term & long-term growth: whether you’re stacking NIL money or saving for a big purchase (like a car or your first home), an HYSA ensures your money earns while you wait.
- Liquidity & safety: unlike investing in stocks, where your money can go up and down, an HYSA is risk-free and allows you to withdraw funds easily.
- Playing the long game: just like training for your sport, small, consistent actions lead to big results over time. Even if you’re only setting aside $50 or $100 a month, that interest will keep compounding, setting you up for bigger financial moves down the road.
Best Practices for Maximizing Your HYSA
- Choose the right bank: look for online banks like Ally, Marcus by Goldman Sachs, or Discover that offer competitive interest rates (typically 4% or higher).
- Check for fees & requirements: avoid banks that charge monthly fees or require high minimum balances. Most HYSAs have zero fees.
- Automate your savings: set up automatic transfers from your checking account to your HYSA. Even $20 a week adds up over time.
- Let it sit & grow: the longer your money stays untouched, the more interest it earns. Think of it as your financial conditioning—steady growth leads to a stronger future.
- Use It for specific goals: whether you’re saving for offseason expenses, a major purchase, or just peace of mind, an HYSA is a great way to make your money work harder for you.
High-yield savings accounts won’t make you rich overnight, but they set the foundation for smart money management helping you to earn off the interest you grow over time. As an athlete, discipline, patience, and long-term thinking are key to success—on and off the field. Start today, stay consistent, and watch your money grow while you focus on your game.