There are several ways an individual can obtain high returns on basic bank instruments, which are essentially risk-free.  With savings accounts, money market accounts, and CDs, you can easily and profitably make your money work for you.  Whether you are looking to save for a down payment on a house, college tuition, or retirement, bank instruments can help you achieve your financial goals.

Savings account basics

A savings account is one of the most popular bank accounts available. The biggest advantage of a savings account is that it lets a person keep money in a safe, designated place, while interest is earned on the money in the account.

he interest rate on the savings account fluctuates depending upon market rates.  Depending upon your specific bank, there may be a minimum balance on the savings account.  Typically, the more money you have in your savings account, the higher interest rate you will receive.  A savings account is typically step one in your rise to financial independence.

The money market account

money market account is a type of savings account.  This type of account is offered by a credit union or a bank, much like an ordinary savings account. The main difference is that the money market account pays a higher interest rate and is withdrawal is restricted.  A money market account yields higher earnings than savings accounts.  

A money market account usually has a minimum balance requirement. Some banks will require that you keep $1,000 to $2,500 in the account at all times. Also, withdrawals from the account are limited, usually up to six times per month.

All of the money in this type of account is insured by the FDIC up to $100,000 and greater for some retirement accounts.  Even if your credit union or bank goes out of business, your money is still protected, making money market accounts very low risk investments.

Cashing in on CD returns 

Certificate of Deposit or CD account is an easy and effective way to not only save money, but to expand your portfolio.  Generally, CDs have higher interest rates than both money market and savings accounts.  The higher interest is a reward for your commitment to a term, ranging from three months to two years, during which you will not access the funds. 

A CD will pay you interest disbursements several times a year, and many CDs will add interest to the original balance so that the power of compounding is in play. The money placed in this type of account is also guaranteed by the FDIC.

One of the biggest drawbacks to a CD is that you are usually charged hefty fees for early withdrawal on your account.  That penalty is however a great disciplinarian and tends to make you keep to the plan.
Although there certainly are financial instruments that will earn you a higher rate of return, basic bank instruments are a great place to start.   You can earn respectable levels of financial profit from bank instruments, which enjoy the benefit of being a risk-free investment.