How much money do I lose keeping cash in checking?

At 3% inflation, $15,000 in a 0% checking account loses about $450 of buying power every year. In a 4% high-yield savings account the same money roughly keeps pace and gains about $150 a year in real terms — a $600-a-year swing.

Are high-yield savings accounts FDIC insured?

Yes — reputable online high-yield accounts carry the same FDIC insurance as traditional banks, up to $250,000 per depositor per bank. The higher rate reflects lower overhead, not higher risk.

Should idle cash go into stocks instead?

Money you may need within a few years belongs in insured savings or T-bills, not stocks. Stocks are for long horizons where a bad year can be waited out. First move idle cash somewhere safe that pays, then invest what is truly long-term.

Idle Cash Calculator — What Sitting Money Loses

Your money in 10 years, in today’s dollars

The cost of sitting still

Buying power, year by year

Both lines are in today’s dollars — what the money actually buys. Solid: moved to the better rate. Dashed: left where it is. Hover any year.

Moving it, safely

How we calculate

What is included

Both paths compound monthly at their yearly rates, then everything is deflated by inflation so the chart shows buying power in today’s dollars — the only honest way to look at cash. The “left on the table” number is the gap between the better option and where the money sits now, after the same inflation hits both.

What is estimated or left out

Savings rates float — today’s ~4% follows the Fed and will drift; inflation zigzags around its average. Interest on savings is taxable (roughly your marginal rate each year), which trims the gap somewhat — we keep the picture pre-tax, as banks quote it. This page is about parking money safely, not investing it; stocks are a different tool with different risks.

The formula, in plain words

nominal value = cash × (1 + rate ÷ 12)^months
real value    = nominal ÷ (1 + inflation)^years
left on the table = real value at the better rate − real value where it sits

Common questions

Is a high-yield savings account actually safe?: Yes — the well-known online banks carry the same FDIC insurance (up to $250,000 per depositor, per bank) as the branch on your corner. The rate is higher because they skip the branches, not because they skip the insurance.
Why does my big bank pay 0.4% when others pay 4%?: Because most customers never move. Big banks fund cheap loans with your patient deposits and bet you will not notice. Moving takes about 15 minutes online — the highest hourly wage most people will earn this year.
How much cash should stay in checking?: About one month of spending as a buffer against overdrafts. The emergency fund and any money waiting for a purpose belong where they earn — our Emergency Fund calculator sizes that layer.

Idle Cash, Priced