Compound interest, what a blessing

My topic today is about high interest bearing accounts. I agree with Einstein when he described compound interest as the eighth wonder of the world. There is something really rewarding about logging into your online account at the end of the month and seeing how much your bank/credit union has paid you simply for keeping your money there.
I would go as far as to say, that I consider having a lump sum in a high interest bearing account is one of the cornerstones for building personal wealth or for saving for any important investment.
It is important to not see this money as available funds, because as long as it is there safe and sound, it is working for you and earning you money. Personally I recommend setting a baseline amount that you will always have in this account and to gradually increase this amount as your interest builds. Most of these accounts do have a minimum initial deposit balance anyway of perhaps 1000 to 5000 in order to set up the account. So, for example, you open your account with an initial minimum deposit of $2000. So of course your baseline amount is $2000. However, you have been saving some cash overseas and decide to move on and you get a large payout, a percentage of which you decide to dedicate to your savings. Let's say you add another $5000 to this account. You now have a balance of $7000 earning between 6-8.5% interest per month. It is at this time that you re-evaluate your baseline amount. This is a personal decision and it depends on your current situation, ultimate savings goals and also knowledge of oneself (did you over extend and may need to withdraw $1000 next month?). but the key is to always make this baseline higher as your balance grows.
Once again, it is paramount that you separate this money and not consider it to be cash at hand. If you find this too difficult you may have to place self imposed controls on access to the funds, this may provide sufficient time for the craving of an impulse purchase to pass.
You may find that once you have achieved a certain amount of monthly interest income you may not be so tempted to buy on impulse something that is just going to depreciate and be superseded anyway.
The other crucial factor when considering these accounts are fees and the interest rate.
It is really important to shop around and find the right account for you. You may see an offer of 8% per annum and think 'super' only to find out that the account is charged a monthly rate of $12 as well as $5 per transaction. Read the fine print and also look for monthly fee free accounts or ones that stop charging fees after a certain balance value. It may be worth checking out your current banking society to see if they offer such accounts in tandem with your daily account, which you may already being paid fees on. So basically you have to make sure that the juice is worth the squeeze. The highest rate isn't always the best if you're being charged an arm and a leg to give them your hard earned cash. $5 a month might not seem a lot when you are earning $1000 per annum in interest but it is still better to avoid it if at all possible.
That's all for today. I would like to delve into this topic further in the near future and I will also be confronting the topic of self-sabotage in wealth accrual.
Until next time, happy saving.