Online Savings Accounts Offer Higher Yields

2007-03-08 10:33:40

( Financial )



If you’re a fairly savvy web user, consider online savings accounts as a secure and convenient way to manage your funds. Online savings accounts differ from traditional savings accounts on two main points:

Ease and convenience: Online banking gives you the luxury to carry out transactions in the comforts of your home. You don’t need to travel all the way to your bank to check your balance, to deposit cash, or to conduct routine banking tasks. Access is readily available, and you can bank anytime and anywhere you want.

Higher yields: The most attractive feature of online savings accounts is the high APY, or annual percentage yield. APY is the amount of money that your savings deposits earn within a one-year period. An annual percentage yield compounds your earnings to make more earnings. While you sleep, your money is earning money. By transacting online, you are actually saving money for your bank. As a result, your bank translates these savings into higher interest rates.

Finding Reliable Online Savings Accounts

Before you succumb to the lure of high yield savings accounts, you have to make sure that you find the right one.

In looking for an internet savings account, evaluate the features of the leading banks. The most competent among internet banks usually offer some or all of these benefits:

Convenient access to your funds: Some internet savings accounts make it hard for you to spend your money. But what if you need to withdraw your funds right away? What if you can’t wait 2-4 weeks before you can get hold of your cash? This is why it’s extremely important to find an online banking service that lets you access your cash whenever you need it.

Customer Support: Most online banks have poor to zero customer support. If you’re depositing a lot of money into an internet savings account, make sure that the bank you choose has proactive customer assistance. Finding efficient customer service should be a priority.

Availability of supplementary accounts: Consider an internet bank that allows you to create several online bank accounts. In the future, you may want to distribute your money across several supplementary accounts.

Add-on Services: An ideal internet bank would allow you to make payments or purchases online. The ability to do online shopping through your internet bank would be a major bonus.

Reliability, Dependability, and Security: Why would you trust an internet bank with a questionable history? Look for an internet bank with existing relationships with the leading banking institutions in the world today. Search for a stable name and a reliable banking partner. Check and double check the security process, and make sure you can trust the bank with your money.

You may also consider asking your existing banks if they offer online savings accounts. Keeping your business in one place would be a convenient solution.


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