How to choose an online savings account
In today's fast-paced world, many people no longer have the time to visit a traditional bank to open a savings account — or they simply don't want the hassle. Fortunately, there's a convenient solution: online savings accounts.
Not only are these accounts easy to open and use, but they also have competitive interest rates, even compared to traditional high-yield savings accounts. However, not all online savings accounts are created equal, so it's important to keep some key things in mind when choosing the one that's right for you.
See today's savings rates here.
How to choose an online savings account
Consider these factors when weighing your online savings account options.
Compare APYs
Online savings accounts have some of the highest annual percentage yields (APYs) on the market because online banks don't have to worry about the cost associated with maintaining physical branches.
That said, these rates can vary significantly from bank to bank, so it's crucial to shop around. The higher the APY, the more interest your money will earn.
Consider the fees
Online savings accounts usually have lower fees than traditional savings accounts — and some have no fees at all. However, some still charge a monthly maintenance fee, ATM fee, minimum balance fee or excess transaction fees.
These fees can eat into your earnings, so be sure to read the fine print and understand all of the terms before opening an account.
Compare your savings account options online now.
Evaluate the mobile app and online platform
Online savings accounts are meant to be convenient, so make sure the bank's mobile app and online platform meet your needs.
The mobile app should be user-friendly, with features like mobile check deposit and bill payment. The online platform should be accessible and easy to navigate, with features like online transfer and account management. If either one feels clunky or doesn't have the features you want, look elsewhere.
You may also want to look for tools that help you manage your money better, such as budgeting tools, savings goals and automated savings plans.
Consider if you'll need ATM access
Some online banks give you an ATM card you can use to deposit or withdraw funds at any ATM in their network, but not all do.
This may not be a big deal if you prefer to leave your savings untouched and don't anticipate needing to access them immediately. But if you'd like to be able to pull out money at a moment's notice — for instance, if you're building an emergency fund — look for accounts that offer ATM access.
View top savings account offerings here.
Check out their customer support options
Since there's no physical branch for you to visit, good customer support is crucial in an online savings account. Look for banks that provide 24/7 customer support via your preferred method: phone, live chat or email.
Read online reviews
Check online reviews and ratings from reputable sources to see what other customers say about the bank's customer service, reliability and competitiveness. You have plenty of options to choose from, so if you see a number of negative reviews, you're better off finding another bank.
The bottom line
Choosing an online savings account isn't hard, but it does require some research and careful consideration. By keeping the above things in mind as you compare your options, you can find the savings account that meets your needs and helps you achieve your financial goals faster.
