<prompt> Human: Something that always blows my mind is seeing people upset about low interest rates or bond yields while simultaneously disclosing that they only have 4-digit sums saved up. For those of us who are just starting to save and invest, understanding how investment works is important, but so is a realistic assessment of what we can get out of it. Thought experiment: John earns 50,000 per year and has 5,000 in the bank earning 0.5 interest. that amounts to about 2.1 in interest every month. Now, John instead decides to invest in a high yield corporate bond fund, and manages to get an attractive 4 interest rate. John is now earning 16.67 in interest per month - but his money is less liquid, has MUCH higher risk of principal loss, is less tax advantaged, etc. 16 is better than 2, right? But Johns salary is over 4,000 per month before taxes... John could make up the difference between those interest rates by making sound frugal choices - saving leftovers, packing lunch at work just a few days instead of eating at a local sandwich shop, etc. High interest rates are nice, but while youre starting out the earnings you get from interest tend to be much less significant than the earnings you get by choosing to save money, be frugal, and generally maximize value.The tables get turned later on though. John diligently saves and now instead of 5,000 in his bank, he has 100,000. 4 interest per year comes to 330 per month - a figure thats much harder to generate by frugal choices, even if his salary has gone up while he saved. If John has 250,000 in the bank, that 4 interest rate is now over 800 per month - more than a lot of people pay in rent - or even live on! in a month. Basically, until you have a lot of money to invest, you shouldnt be distracted by yield. Its bad to leave money on the table but its worse to chase yield by taking on more risk than you need to via investments in stocks or other risky asset classes when the return could easily be matched through lifestyle choices. Now, if you have an emergency fund and know you arent saving for something short term house, car, etc. then theres no reason to AVOID higher-risk, higher-reward investments just because your total account size is small. But it absolutely shouldnt be the first priority. Assistant: tl;dr: Save early, save often. Human: Indeed. But the magic starts with steady savings, not jumping through hoops to get a 1.25 interest rate instead of a 0.7 interest rate.  <response>: Same reason why increasing your income will not always increase your savings, unless you dont increase your expenditures. TLDR: Being frugal is more important than how much money you make, or how high your interest rate is. 