Although brick-and-mortar banks are competitive, you can often find more attractive interest rates in online savings accounts. Making the leap from traditional banking comes with some risk, so you should be careful when choosing your bank.
online savings accounts
In an email to customers, savings site SmartyPig announced it had cut its rate from 1.75% to 1.35% APY. Now it’s no longer the top rate for a nationally available online savings account. Sad day.
You may have noticed it’s dang hard to get a good rate for saving money right now. Used to be you could get an online savings account with 5%, no problem. Now if you can get in the upper 1% you’re doing pretty good. So what’s the dilly?
SmartyPig just cut the interest rate on its online savings accounts from an ahead of the pack 2.15% to 1.75%, unless you have $50,000 or more in your account.
Even though GMAC spun off from GM years ago, they recently changed their name to “Ally” in a re-branding, stain-of-association-removing effort. Their whole game seems to be a USAA for civilians, advertising “No minimum deposits. No fees. No min balance. No sneaky discalimers.” Ally Bank is also offering very juicy APYs, like 2.25% for an online savings account, more than double the national average…
Are you earning at least 4% in your savings account? If NO, do yourself a favor: Open a high-yield online savings account and start adding some serious muscle mass to your savings. Here’s the skinny:
HSBC sent around a big cheery email to let everyone know that they’ve extended the promotional 3.5% rate on their online savings account until September 15th.
Now that interest rates have fallen, online savings accounts aren’t offering the same kind of return as before, but you can still stay liquid and get more than what you get in a brick and mortar bank. Here’s some online saving accounts offered by FDIC-insured banks ranked by the interest they pay out:
A roundup of some of the most popular banks for high-yield online savings accounts. [Five Cent Nickel]
My Husband and I called Embarq for a bundle pack with dish network in April of 2007. We were told by Embarq that we would only be seeing one bill from them, that would include dish charges, and that it would be about $100 a month. We have paid our bill every month, and never had anything suspended. As a matter of fact, we had never had to make any inquiries about dish as it had been a wonderful experience until mid-January. One morning I was turning on Mickey Mouse Clubhouse for my son and I had no service. So I called Embarq, who told me to call Dish, who had no record of our names or social security numbers, who told me to call Emarq again…
So, of course, one day after I post about how great E*TRADE’s 5.05% savings rate is, it drops to 4.4%. Truth be told, that was kind of unsustainable with the federal interest rate at 3.5%. It will still probably be higher than the rates offered by the other players which have like HSBC Direct (currently 4.25%), ING Direct (currently 3.6%), and Emigrant Direct (currently 4.55%). Tears, tears.
Today’s interest rate cut means online savings accounts lovers will once again experience heartbreak as their high-interest accounts become even less so. There is still one company offering rates from the what now must be seen as halcyon days; E*TRADE’s online savings accounts give you 5.05%, though it’s not without caveats…
E*Trade increased the rates on a variety of banking products this week in an effort to woo back depositors spooked by their recent troubles. Here’s how they’re looking:
So you just found some awesome interest rate at an online bank. Only problem is, you’ve never heard of the place before. How do you know if your money is secure?
Yesterday we bemoaned HSBC’s online savings account dropping by .55 percentage points, and gazed hungrily at Emigrant Direct’s still-holdin’ strong 5.05%, so of course Emigrant Direct to cut theirs to 4.75% today. Until the impact of the federal rate cut sets in, don’t go rate chasing. [Emigrant Direct]
We checked HSBC Direct’s front page daily after the Fed interest rate cut, in fear that our fave online saving account would also cut its high 5.05% interest rate. We chuckled as complaints rolled in about people’s various money market accounts getting their rates trimmed. After we were lulled into a false sense of security and stopped checking, a reader pointed out that HSBC has slashing the rate to 4.5%. Noooooooooooo…