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Here’s How to Earn Many Times More on Your Savings


Here’s How to Earn Many Times More on Your Savings

Here’s How to Earn Many Times More on Your Savings Photo by Monster Ztudio /

Does the measly interest rate you earn on your bank account make you feel a little cheated? You are not alone! But here’s the good news — an alternative that allows you to make 5 percent interest and help your community at the same time.

Here’s how it works: You buy 36-month Worthy Bonds for just $10 each. Your money is loaned to small businesses through a peer-to-peer system, also known as P2P lending. Small-business owners using this system gain access to capital, and you earn 5 percent on your investment.

Not only that, but you can set up an app to make regular, automatic bond purchases, or funnel your spare change into this investment in small increments as you make purchases — which allows you to invest money that you will hardly miss. (We’ll explain how that works below.) What it means is that we ordinary mortals, with ordinary amounts of money can get in on returns that are usually the domain of rich people.

“We created an alternative way for people to save that not only pays 5 percent interest but helps support growing businesses across the country,” says Sally Outlaw, founder and CEO of Worthy Financial. “Ultimately, I want to help as many people as possible have a more secure financial future.”

Worthy’s bonds are an investment for the masses, not just the 1 percent, Outlaw says.

“It’s about time we have access to the types of institutional quality investments that the wealthy have always had so we too can see some real financial growth,” she says.

Think about it: If you invest $1,000 in Worthy Bonds paying 5 percent interest, you’d have $1,050 after a year. If you put that money in a typical bank savings account paying the national average interest of .09 percent, you’d have only $1,000.90 at the end of the year.

How it works

The easiest way to invest is using the Worthy Financial app available on Apple’s App Store or Google Play.

Link the app to your bank account or credit card — Worthy will track each debit or credit card transaction you make and round up “spare change” to the next whole dollar.

Worthy’s example: If you purchase a bottle of water with your debit card for $1.39, Worthy tracks the 61 cents difference between the purchase and the next whole dollar. The next day when you fill up your gas tank for $24.20, again Worthy tracks the remaining 80 cents to the next whole dollar. So far, Worthy has tracked $1.41. As you go about your spending, Worthy keeps tracking your “spare change” and shows it to you on the app’s dashboard. When the “spare change” adds up to $10, it triggers the purchase of a $10 bond, which earns 5 percent interest.

Despite the bond having a 36-month term, you can cash out any time with no penalty.

You don’t have to wait for the spare change to add up to buy a bond, either.

You can buy as many bonds as you like at any time, Worthy says. You can even set up recurring purchases to put your bond investments on autopilot.

Besides using the app, you can also make transactions on your computer through the Worthy website

Where your money goes

Worthy Peer Capital invests all bond sale proceeds into fully secured, asset-backed small-business loans made to creditworthy, mostly veteran-owned firms, Worthy says.

In $25 increments, Worthy invests in fractions of loans to qualified borrowers who use online financing marketplaces rather than banks.

The Worthy loans typically offer more competitive rates for borrowers while offering you, the investor, a higher rate of return.

That’s the kind of action usually reserved at a grand scale for investors trading on Wall Street, Outlaw says.

Corporate bonds traded on Wall Street are issued by companies to raise money for themselves. With Worthy, the smallest investors can benefit from strong returns usually reserved for institutions and the wealthy. Also, stock market volatility won’t impact your investment return.

While your money is at risk if borrowers don’t repay their loans, the bonds are backed by a reserve fund that holds money aside in the event of unexpected losses, Worthy says. This fund is designed to give you your full return.

Important reminder

Worthy reminds investors that it is not a bank and investments in Worthy Bonds are not bank deposits, nor are they insured by the FDIC. They have received regulatory approval from the Securities and Exchange Commission, Outlaw says.

“You should be comfortable with your understanding of the investment and its risks,” Worthy says.

Outlaw says she created the bonds so as many people as possible would have access to higher-yielding, community-based investments.

“I think everyone is worthy of economic security, and if we can help provide this, while offering both a financial and a social return, it’s a home run,” Worthy’s Outlaw says.

What’s your experience with alternative savings programs? Share with us in comments below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

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