topic Re: On Line Savings Accounts in Community Chat

On Line Savings Accounts

buffieg — Sun, 01 Dec 2019 12:29:25 GMT

Does anyone have experience with on line savings accounts? Every month my interest is less than the month before at my brick and mortar bank. I know the on line banks pay higher interest and I would like to switch but need to know they are safe. Any advice would be helpful.

Re: On Line Savings Accounts

tototwo — Sun, 01 Dec 2019 12:52:54 GMT

I hope they are safe! I've had online savings accounts and investment accounts for several years. Interest rates have been up and down recently, but the interest rates on my online accounts are always higher than our local institutions. For me, it's always been easy to deposit, withdraw, and transfer money from account to account. I haven't had any problems.

Re: On Line Savings Accounts

SilleeMee — Sun, 01 Dec 2019 12:45:51 GMT

Credit Karma keeps sending me messages about their new savings account. They say it has great high-yield rate. It's free to open and there's no fees or minimum to keep open. But I'm not sure about using online savings accounts. I never have. I just use my local credit union online services. I feel safe with that but I'm open to change.

Re: On Line Savings Accounts

novamc1 — Sun, 01 Dec 2019 13:05:40 GMT

@buffieg

I have a variety of online savings accounts with banks paying above-average interest rates, and they work well.

The online nature of them means you don't have to get in the car and go to your local bank branch.

Usually, for me, it's better when transferring money, opening a new account, confirming what should happen to a matured CD, or whatever else, to both follow and manipulate the accounts online but also talk to bank personnel at their headquarters' toll-free phone numbers and get them to help me.

Like all banks everywhere right now, online banks have been reducing interest rates paid on all types of savings accounts, including money market, certificates of deposit and even checking accounts.

When the Federal Reserve thinks it's wise to reduce the overnight interest rate that banks use to transfer money among themselves. it's supposed (??) to signal a change in the economy for better or worse.

Don't try to waste time to understand it. The one understandable thing is.......... The days of chasing higher interest rates among banks is probably over for a while, but it will come back someday, just as it did several years ago after a long period of VERY low interest.

Re: On Line Savings Accounts

novamc1 — Sun, 01 Dec 2019 13:24:33 GMT

@buffieg

To find out whether any bank, brick/mortar or online, is "safe", go to bankrate.com and look up the bank or search for banks with the characteristics that you're seeking.

Banks that are federally insured by FDIC are safe, provided that the account holder registration and amounts in the accounts meet FDIC qualifications.

fdic.gov

is the website for the Federal Deposit Insurance Corporation, where you can look up various banks, too.

Re: On Line Savings Accounts

jellyBEAN — Sun, 01 Dec 2019 13:13:54 GMT

I'm glad you asked this question because I am curious also. I'd like to establish some type of money market account in order to both save and write a monthly check for a payment.

Is it too personal to ask what banks are most popular for this type of thing? There seem to be banks on-line i've never heard of before and thus I'm leery.

Re: On Line Savings Accounts

jellyBEAN — Sun, 01 Dec 2019 13:15:22 GMT

@novamc1 Thanks. We must have been posting at the same time.

Re: On Line Savings Accounts

CelticCrafter — Sun, 01 Dec 2019 13:19:28 GMT

We don't have any on line accounts but what we have found is that the little community banks are giving a lot better interest rates than the big banks.

Re: On Line Savings Accounts

geezerette — Sun, 01 Dec 2019 13:25:35 GMT

And I've found that if you happen to carry a higher balance, much like many cable companies, if you go into your bank and tell them that you're going to take your money somewhere else that offers a better interest rate, they will magically find a way to raise theirs a bit.

Re: On Line Savings Accounts

gidgetgh — Sun, 01 Dec 2019 13:41:48 GMT

Ok, I'll name one we use. We've had an online money market account with American Express for years. Pays way better interest than we can get locally. It's FDIC insured.

We've never had an issue but everyone should do their own research and do what's best for them.

Re: On Line Savings Accounts

Havarti — Sun, 01 Dec 2019 14:15:30 GMT

I have a question I am curious about regarding online-only banking. If they don't respond to you electronically or by phone what do you do? There is no local physical place to walk in and insist your issue be addressed, so can't they just tie up your funds by ignoring you if there is a problem? The thought of that worries me and I would honestly like to know from people who use this method what the reality is for situations like this one. TIA

Re: On Line Savings Accounts

novamc1 — Sun, 01 Dec 2019 14:39:35 GMT

@Havarti

Any reputable bank should and probably will respond to you when you contact them. They don't want to get in trouble with the government financial regulators by ignoring you or abusing your funds.

That's a simplistic way of saying not to worry about your funds being illegally "tied up".

I've had worse luck at some very large national and regional l banks when walking into their branches and dealing with people who are really low-level, low-paid and not-very-experienced employees.

I've met with some horribly incompetent "vice presidents" of those banks at local branch offices.......they always seem to need help from their headquarters staff on the phone if my issue is anything more complicated than cashing a check or depositing money. (That's a teller's job, anyway.)

I've had a lot of experience with many different banks over the years, and the online banks are either just as good or better than small branch office of a large nationally-known bank down the street.

Plus, online personnel are available to talk online or on the phone for more daily hours than most local branches.

Just my opinion and my experience.

Re: On Line Savings Accounts

scatcat — Sun, 01 Dec 2019 15:28:11 GMT

E Trade on line has competitive rates as well

Re: On Line Savings Accounts

Nuttmeg — Sun, 01 Dec 2019 15:29:13 GMT

@Havarti

You may want to open small account and see how it works.

Most of our banking business is online anyway.

Re: On Line Savings Accounts

Mz iMac — Sun, 01 Dec 2019 16:57:55 GMT

@scatcat wrote:
E Trade on line has competitive rates as well

They also have excellent "telephone customer service reps" which is 100% based in the USofA. They are available 24/7/365.

E*Trade will also snail mail your forms if you wish. Discuss/clarify your wishes/account(s) over the phone in great detail until YOU understand before any transactions are done. They will CYA all phone convo in writing by snail mailing if you wish to have a "paper trail."

Re: On Line Savings Accounts

Allegheny — Sun, 01 Dec 2019 17:14:12 GMT

We have our B&M credit union, but also about two years back to decided to try on line saving with Citizens Access. At that time their saving and CD interest was much higher than B&M. As @novamc1 mentioned newly offered rates are going down, but we are still happy with our existing CD rate and saving interest rate.

We still have accounts at our credit union also.

And yes I was nervous at first. We can transfer funds back and forth from our credit union and vice versa. We haven't tried taking a direct withdrawal from the savings account, but we did let one of the CD's mature and just put that money go into the saving's account.

Now if you need to get a withdrawl out of the savings' quickly I'm not sure how that works as there is no physical location to go to. I have to read up on that.

Re: On Line Savings Accounts

Snowpuppy — Sun, 01 Dec 2019 17:41:09 GMT

I had AMEX for a few years and had no issues. Super easy to move funds electronically and good CS.

That said, they began to limit the number of transactions per month to I think 4 per month. And that's when I moved on.

Re: On Line Savings Accounts

itsmetoo — Sun, 01 Dec 2019 18:24:04 GMT

We have used online only banks for many, many years for high interest accounts because their interest rate is so much better than most brick and mortars. To name a few Synchrony, Discover and Ally are banks highly rated on bankrate.com and are FDIC insured. You can always talk to someone on the phone. Bankrate.com will rate the banks, you can check their FDIC insurance and you can check to see who has the best interest rates. I have also used banks I'd not heard of before as long as they are FDIC insured with no problem whatsoever. Sometimes banks are only in certain parts of the country and that's why maybe I haven't heard of them. Interest rates are pretty bad right now though everywhere but the online only banks are usually better. I am NOT giving advice or telling you what you should do, just telling you my experience.

Re: On Line Savings Accounts

deeva — Sun, 01 Dec 2019 18:33:08 GMT

I've had an online savings account since 2004. When I opened the account the interest rate was 5.5%, boy, have times changed.

Never had any problems transferring money and they are FDIC insured.

Re: On Line Savings Accounts

novamc1 — Mon, 02 Dec 2019 01:03:04 GMT

@Allegheny

You said:

<<Now if you need to get a withdrawl out of the savings' quickly I'm not sure how that works as there is no physical location to go to. I have to read up on that. >>

Two othings you can do.......

(1) At the same bank, you can set up a checking account, or even a money-market account that allows check-writing acess. You could then transfer money from a matured CD or any other type of savings account directly into that account and should have quick access to it.

(2) Establish links between your accounts at various banks, so money can be transferred from one bank to another in a matter of moments. This is usually referred to as an ACH transfer).

If the amount being transferred is large, it's better to get a bank person on the phone and get info about how soon that money can be used by you. Certain types of accounts and certain banks have liimits on how much can be withdrawn and accessible at one time.

Banks also may have limits on how much money can be withdrawn by you in an online transaction--such as $5,000 or so. You need to spend some time on the phone getting larger transactions authorized and executed by a live person.

It might be worth the effort to open and maintain accounts at more than one bank and to link them, even if you think you dont' need another bank and might seldom be transferring money.

That's my experience, anyway, for what it's worth.