People no longer have to rely on limited local banks for opening a savings account. There are multiple options for people to save their money and earn interest on the same. Online savings accounts, money market accounts, and Certificates of Deposits (CDs) are some new options people now have. A savings account is a basic account to have at a bank or a credit union that allows account holders to keep their money safe, and use it when needed. The interest account holders earn is typically on the deposits they make; the interest rate is relatively low on savings accounts. It is, however, possible to find some savings accounts that offer high interest rates than other accounts.
While looking for opening savings accounts online, one should give importance to safety. FDIC insurance covers the banks, and therefore, those who store their money in the banks have it covered. FDIC stands for the Federal Deposit Insurance Corporation, which is a government agency that is in charge of banking and consumer safety.
National Credit Union Share Insurance Fund (NCUSIF) covers the federally insured credit unions. Those who have accounts in credit unions can rest assured that their money is looked after. NCUSIF is backed by the federal agency National Credit Union Administration.
Those with savings accounts in the banks or credit unions have an easy access to their money and earn interest on the same. The interest rate is dependant upon various factors. The economic conditions and competition among banks are some prominent factors influencing the interest rate. Savings accounts often beat checking accounts as people prefer little interest over no interest at all.
As mentioned above, there are essentially three types of savings accounts, online, money markets, and Certificate of Deposit (CDs). Those opting for online savings accounts have the benefit of higher earnings and lower fees. There are no overhead costs with online banks as opposed to brick-and-mortar banks. Online banks provide the account holders with an ATM card for withdrawing cash and transferring funds from (or to) a local bank or credit union electronically within three business days. Mobile devices can be used to deposit checks as well. To learn more about the available options for online savings accounts are mentioned below.
Ally Bank is one of the best online banks for savings accounts. The APY (annual percentage yield) with an online savings account in Ally Bank can be as high as 1.75%. This bank provides the same-day transfer through Zelle, which is a U.S.-based digital payment network. There are no monthly maintenance fees the bank charges its customers and has been rated as one of the best banks for online banking.
Though Capital One is better known for its credit cards and bank accounts, that doesn’t stop the bank from being one of the best online banks for a savings account. The Capital One 360 Checking® and savings accounts are among the top and most popular online savings accounts. There is no fee charged for the savings account and no minimum deposit is required. Capital One is also a member of Zelle payment service through which account holders can make instant transfers and transactions.
American Express is one of the old providers of financial products and services and is often known for credit cards. The bank provides an annual percentage yield of 1.75 for the online savings account. There is no minimum balance or monthly fees charged for opening an online savings account with American Express bank. Connecting to accounts at other banks for transferring funds through American Express is a smooth process.
There are several other banks one can open their savings accounts in; they are Discover, CITI Bank, Barclays, Marcus by Goldman Sachs, and Synchrony Bank.