Internet Savings Accounts: Advantages and Disadvantages

2007-03-08 10:33:40

( Financial )



Internet savings accounts are accounts that are only offered online. Most banks still allow you to visit their offices in person, but internet savings accounts are mostly targeted to online users.

Internet savings accounts allow you the flexibility and convenience not readily available to the ordinary savings account. You are able to conduct transactions anytime of the day even if it is after banking hours or if it is a holiday. You do not have to join a long queue just to deposit a check or make a withdrawal. Most internet savings accounts also offer a higher annual percentage yield or more commonly known as APY. It basically means that the bank passes the savings it has incurred to you because you chose online banking.

Despite these conveniences, there are several factors you have to consider before getting an internet savings account. You should check their APY rates. Access to your account is crucial. Your online account interface should be user-friendly. You should also check for flexibility. Internet savings account should allow you to link several accounts into one online account for ease of use. You should also consider the perks. Most banks offer additional perks to loyal customers or to customers who have several products in the same bank. Customer service is also important. And the bank should be safe and secure. You can ask their customer service representatives about their security processes.

There are several disadvantages to internet savings accounts. Online savings accounts usually have a toll free number for customer service. You may talk to an agent who is knowledgeable, but you may also get agents who are not. Internet savings accounts also have longer clearing times. Same goes for deposits made to your online bank account. And you cannot take online bank accounts with you. Online bank accounts are designed for people who wish to keep their money in their account.


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