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Outlet Review: A 6% Interest Savings Account Alternative - YouTube
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can you really make a 6% return in a
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savings account yeah you can that's
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today's show let's dive into it here we
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are our very first rental property
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hey everyone I'm Clayton Morris long
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time real estate investor created
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multiple seven-figure businesses and
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look there's a lot of times when we need
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to have a savings account something like
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our rainy day fund that's gonna be
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generating some return but most of the
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time can't get much of a return at all
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savings accounts are pretty terrible so
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enter a brand-new savings account only a
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few months old this company it's called
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Outlet you can find them an outlet dot
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finance we'll have a link below where if
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you sign up you actually get a bonus for
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signing up so I want to walk through
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this app because when I saw that you can
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get a 6% return which would even beat
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other companies like wealthfront and
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betterment in their returns I said I got
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to try this and maybe we should take our
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savings account and move it over if it
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actually is going to work so that's
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exactly what we did to test this out we
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moved over money into the outlet app now
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it's very simple to download you can go
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on your iPhone or Android device and
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just download outlet that's how we spell
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it and it's fit the app is very easy to
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use and integrates directly with your
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bank using the plad service PLA ID you
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enter and pick the bank that you have
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and it's very easy to transfer money
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right into this account so how does it
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work well it's actually really
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interesting it's not a traditional
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savings account and that it's not backed
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by the FDIC right that's the first
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question right and that was one of the
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questions as I was doing all my research
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on this well is it backed by FDIC where
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you're protected up to two hundred and
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fifty thousand dollars by the federal
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government no this is not backed in the
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same way so the way that outlet works is
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its able to generate returns by using
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money market accounts and this is what I
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wanted to dive deeper into as
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understanding these money market
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accounts the money that you deposit into
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outlet gets exchanged then into digital
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dollars that are put to work in these
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separate money markets as they say on
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their website and what then that means
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is other people around the world can use
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these digital dollars into in order to
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pay you interest that's how it works
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that's how you're able to generate
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higher interest rates yes it's not a
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traditional savings account like a
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Bank brick-and-mortar bank where you're
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protected by FDIC insurance so then
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you're thinking okay this might be more
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volatile is this gonna be a problem for
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me so you actually are protected with
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their own insurance plan that they have
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and this is where it's really
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interesting so they actually have their
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own insurance with Nexus mutual and so
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if you deposit up to about fifty
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thousand dollars you are protected with
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their insurance plans so something funky
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were to happen to your money you're
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protected for loss and if you want to
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deposit more than that fifty thousand
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you're able to work with them they're
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able to provide more coverage more
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insurance against that loss so it really
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is your own FDIC insurance policy for
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your money in these accounts
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so it's interesting once you deposit
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this money you're able to see your sort
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of daily returns you can see swings in
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the market going down to like three
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percent return and then I've seen it
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actually go as high as twenty percent
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interest so you can see how much money
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you're making directly inside of the app
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on your iPhone and you can of course
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withdraw the money at any time this is a
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question I had am I now have to keep it
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in here like a stock account and I've
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got a wait no you can instantly transfer
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it right out to your account anytime you
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want so you get these bonuses you get
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additional money that flows into your
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account you get then you know a nice
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return and you want to take some money
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out and roll those those those funds
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into your bank account separate bank
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account great so if you deposit five
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thousand dollars and you're making a
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great return you make a few hundred
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dollars you know because of the interest
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rate you're able to take that money
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right out and put it into your account
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that's how that works I want to go a
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little bit more deeply here on the
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insurance coverage because this was a
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question I had and obviously we're all
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trained to believe that when you have
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money in a bank it's protected obviously
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with the FDIC insurance so here's a
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quote right from their website about
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Nexus mutual they have a smart contract
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cover which is intended to provide
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protection against material loss of
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value resulting from unintended uses of
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the underlying protocols basically it
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means that a vulnerability in your
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contract code that governs the protocol
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has been exploited and a material amount
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of value has been
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rained or made permanently irrevocable
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so you lose your money there's insurance
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and you get it back and then at like I
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said again you can increase that
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coverage by talking with them as you
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make higher deposits in that account but
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that's pretty great
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that they've got separate insurance for
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you and this was one of the things that
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I wanted to know more about so what
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they've explained to me is that in fact
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when they set this up they wanted to not
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just go after people who were you know
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using crypto and and the stock market
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they wanted to help people who were used
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to old crappy traditional savings
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accounts and they wanted to be able to
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provide that level of insurance
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protection for these new people people
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who are used to having that kind of
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insurance coverage that's great that's
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thoughtful I'm glad they did that what
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about fees how much does it cost to set
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up this account how much does it cost to
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take money out of this account how much
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does it cost
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all around zero zero fees it's pretty
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great for a savings account zero fees
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can't beat that
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now they address a big question right on
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their website about what happens when
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someone borrows your money so that's how
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this works right you're putting your
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money into outlet they're transferring
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it to a digital currency and they have a
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one-for-one stable coin that means there
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is $1.00 of paper backing your dollar
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that's going into that account so
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they're actually holding that almost
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like a Fort Knox in a way so there's
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actual currency backing your deposit and
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the way that they protect against a
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borrows borrower running off with their
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money they explain it right on the
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website which is this in order for
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anyone to borrow your digital dollars
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the loan must be over collateralized
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this means that if the borrower wants to
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borrow one hundred dollars of your money
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they must put up at least a hundred and
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twenty dollars worth of collateral if
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they don't pay the back the loan then
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they lose their collateral this
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incentivizes the borrower to pay back
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their loans otherwise they lose more
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money than they borrowed so this
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collateral in this case comes in the
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form of digital assets as they explain
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such as a theorem or you know for
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example like a Bitcoin so if they want
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to borrow $100 at 8% interest they would
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have to then what outlet does is they'll
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lock up a hundred and fifty dollars
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worth of aetherium or other cool
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and that's how your asset is protected
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in that account so there you go is it
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worth a shot
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absolutely at these returns much better
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than a traditional savings account and
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actually better than some of the other
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the other accounts that are out there
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right now well front and betterment and
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so on so check it out if you want to try
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it and try out just signing up and make
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an initial deposit start making you know
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6% returns
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5% returns 7% returns like I said I saw
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it go up to 20% returns the link is
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right below this video to try it out and
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you'll get a nice little signup bonus
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when you do and the best part when you
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sign up you can also tell your friends
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about it and then they'll give you a
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nice signup bonus for having one of your
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friends sign up as well so pretty great
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anyway check it out below let me know if
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this works for you we have now
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transferred a boatload of money and I'm
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gonna do a follow-up video here over the
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next few months to see how the returns
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have been in this savings account
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because we moved it out of this low
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return savings account into outlet there
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you go that's today's video folks we
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hope to see you next time right here on
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the channel
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