Earn A Lot More Interest By Opening A High-Yield Online Savings Account

Your savings can earn upwards of 4 more percentage points of interest, if you put it one of these high-yield online savings accounts. Here’s seven to check out.

HSBC Direct 5.05%
eTrade 5.05%
Emigrant Direct 5.05%
WaMu 5%
Capital One 4.75%
Citibank Direct 4.5%
ING Direct 4.5%

Note that under federal law, many online savings accounts may limit you to 6 withdrawals max. So don’t give up the brick and mortar yet. Instead, the “old-skool” bank for your day-to-day transactions, and an online savings account as your long-term piggy-bank.

UPDATE: Reader bosco says,

I think you should make a note that the 6 maximum withdrawals are on a monthly basis and only apply to electronic withrdrawals (an online transfer) but if the bank gives you a check payable to you or you use an ATM, those do not count.


Edit Your Comment

  1. Covert7 says:

    I use [gmacbank.com] and get over 5% interest as well. I’ve been very happy so far with my experience there.

  2. Sucko-T says:

    Don’t use WAMU. I emailed them asking if I could get the high interest savings without opening a checking account (already have checking account w/them) they said I could, but I would have to go the bank to do it. Visited two banks and they told me I had to go online and open another checking account. Make up your mind! I closed my pitiful .1% wamu interest savings now use ING. Not the highest rate, but very easy to use and the rate won’t go down.

  3. Thrust says:

    Put very simply, 4-5% interest earned is nothing. If you have outstanding debts (Car Loan, Student Loans, Balance on your credit card, etc) they could be costing you 4.9% to 29% or more, compounded monthly. Pay off your debts before trying this banking.

    For those who are well into the green, 4% isn’t bad for a low risk investment, but make sure you’re making significantly more in interest than their service fees.

  4. not_seth_brundle says:

    @strum40: It sucks that they misinformed you. I have the WaMu high-yield savings and love it, but I did open it with a new checking account, both online.

  5. pinkbunnyslippers says:

    @Thrust: Credit cards aren’t compounding 24% interest monthly -that’s annually.

    But the point still remains the same.

  6. Dead Wrestlers Society says:

    COVERT7 Hey, so do I. Yep, I am also a satisfied customer. I would recommend them.

  7. Islingtonian says:

    @Thrust: true, it’s not the best deal compared to stocks or whatnot. but it’s a good place to set up an emergency fund, or to create some amount of savings that can later be refueled into 1) paying off debts or 2) a higher-yield investment.

    i’ve been using ING direct for about 6 months and i’ve been happy with the service i’ve recieved. although i have outstanding student loans, i think it’s important for me to save up money now so i can make bigger purchases later (ie, a car, moving expenses, etc). i’ll save money on those by paying in cash, instead of with a loan or a credit card.

  8. foghat81 says:

    I was able to get in one recently at citibank that had a 4.65% rate and after 90 days they give you a bonus $100 deposit. Not too shabby. It was the third high-yield account I have….all of which have been opened under some sort of promo (at the least a $50 referral or something). Be sure to shop around and try to score a promo deal!

  9. sleze69 says:

    I’ve been using HSBC’s account for a year. So far, nice interest and no real complaints.

  10. AdmiralNelson says:

    The source for High-Yield Sav/MM Accnt info and CD info: [bankdeals.blogspot.com]

    I signed up with FNBO Direct who are doing 6% until 9/28 then it is 5.25% after that point.

  11. beyond says:

    FNBO beats them all. They have a promotional 6% rate until the end of September and prior to that were 5.25%. I’m very happy with their service, although I use ING for my checking and bill pay.

  12. kingoman says:

    I opened (on-line) a 2nd ck/sav account at WAMU to get the high interest and it’s been fine. I went in to close my “old” ck/sav accounts and the guy sort of casually mentioned to me that the high interest on the new (free) accounts was promotional and was probably going to revert to “normal” at some unknown point in the future.

    It’s been almost a year, so he may not know what he’s talking about and if it happens I’ll just close it. But be aware of it if you do sign up for this, don’t make it your only bank account if that’s a deal-breaker.

  13. Dead Wrestlers Society says:

    @AdmiralNelson: That’s a good website, but it seems too restrictive (have to live in this state, etc.). Bankrate.com has a lot of searchable features and CDs/MM listed are open to anyone. I bought a CD last year from a bank in Indiana and I live in Va.

  14. TehRev says:

    I second CONVERT7 on GMAC. I have had GMAC for over a year and their customer service is top notch. They can handle anything and are nice and quick. Also they are currently at 5.30% which is solid. They are always competitive with their rates.

    http://www.gmacbank.com Gets my account after lots of research. Also their ACH transfers are pretty quick.

  15. mathew says:

    I’ve had good results with ING Direct. I used it as a handy place to keep a six figure sum while waiting a few months for the chance to close on a house purchase. Didn’t have any problems getting the money back out, and got a nice chunk of interest into the bargain.

  16. quagmire0 says:

    Another GMAC customer here. Great rates and no problems to report.

  17. pestie says:

    Uh, that’s Capital One, not “Capitol.” You know, capital – like, money?

  18. TechnoDestructo says:


    Last I checked, my ING CD didn’t have any service fees. They’re making more in interest and investments than they’re paying in interest.

    Which is always how I learned banks were SUPPOSED to work. (And since I grew up with a credit union account, anything else has never seemed normal to me, and still has the power to offend.)

  19. phripley says:

    Costco members get an even better rate with CaptialOne savings.

    I had a CapitalOne savings account and then joined Costco after. Expected a big hassle to claim the higher Costco rate but they set it up right over the phone (did have to close one account and open an other account but the CSR was friendly and efficient).

  20. jeffeb3 says:

    @Thrust: My student loans are at less than two percent. I could pay them off, but I make money with a super reliave capital one savings account.

  21. hellinmyeyes says:

    I opened a CapitalOne high-yield money market account a couple months ago. I’m glad that they have no minimum balance and pretty flexible check-writing and atm-withdrawal terms, but it absolutely sucks transferring money. They say three business days but in reality it’s more like five or six before the transfer is complete. I don’t understand what the big hassle is transferring money between two accounts to get this working. I guess it’s that sort of thing where you’re already getting away with so much (good rate, check-writing) that you really shouldn’t complain, but still… UGH!

  22. Welcome_to_Oakas says:

    I’ll third or fourth GMACBank as well on their high interest rate. Another plus: their privacy policy has you automatically opted-out of the info sharing that you have to go out of your way to change at other banks.

  23. starlily says:

    I used to have a money market with Capital One, earning about 5% APY. But a couple months ago they started to offer a “High Interest! Free Checking” account which is even better:
    Earn 5% interest for the first year, no minimum balance, no monthly service fee, plus they reimburse ATM fees. Here’s the link – [www.capitalone.com]

  24. joe6486 says:

    Why do these lists always leave out COUNTRYWIDE, which offers an even higher 5.4% APR?

  25. miborovsky says:

    I’m getting 7.5% APR with my BECU checking and savings – only for the first $500 you put in each, though.