Is it true that online savings accounts have better interest rates than banks?
A. A. Yes! Many online banks and savings programs offer interest rates around 1.5% higher than if you walked into the branch of your local bank and opened an account (last fall, they were almost 4% higher). This might not sound like a lot, but if you have $10,000 in savings, it could mean the difference between earning $250 instead of just $40 or $50. ING Direct even lets you make sub-savings accounts with specific goals, like “Vacation to Thailand,” or “House down payment,” so you can budget your money. You might also check out Emigrant Direct and HSBC Direct. E-Trade is another great option because they pay your ATM fees no matter where you pull money out. And fear not: Credible online banks are FDIC insured, so you don’t have to worry about losing your dough.
Related Questions
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- Is it true that online savings accounts have better interest rates than banks?
