Have You Discovered the Benefits of Saving with ING?

I first learned about the ING Orange savings account three years ago on a bargain hunting message board that I frequent. They were offering a $25 bonus for opening a new account. I have a hard time passing up free money, but I am also a skeptic when it comes to offers that seem too good to be true. After doing some research, I decided that it was worth checking out. I figured that if I was not impressed, I could always cancel my account after the $25 was deposited. Three years later, I am still a satisfied customer. If you have set a goal to create an emergency fund or you are just looking to increase your savings, an ING savings account may be a good option for you.

How it works

ING is different from other banking institutions in that business is primarily conducted online, which helps cut down on overhead expenses. You do have the option of completing transactions or contacting customer service via phone or mail and they have recently added Café's in New York, Philadelphia, Los Angeles, and Wilmington where you can conduct business in person.

ING is a "global" financial institution that employs over 112,000 people in 50 countries. They have been operating in the United States for over 100 years and are FDIC insured. They offer a number of services including savings accounts (Orange savings account and CDs), home loans (mortgages and home equity loans), and investment accounts (mutual funds and IRAs).

The easiest way to open an ING savings account is online. The process is simple. You enter your personal information, agree to the terms and conditions, make an electronic deposit from your checking account (you only need $1 to do this), and then submit your application. Be sure to print off your confirmation page and account number. At this point, you will be able to access your account online. Your initial deposit will be withdrawn from your checking account within one to three business days. ING will also make two small deposits into your checking account "verify" your account. You must then log into your ING account and verify the deposit amounts to fully activate your account. You can link up to three checking accounts to your ING account.

The benefits

The most frequently discussed benefit of an ING account is the high interest rate. The rates are currently at 4.5%, but I would recommend checking their site for updated information as they are very competitive and increase the rates often. I reviewed my account history for the past year, and they increased the rate seven times during that twelve month period. In contrast, I reviewed my savings accounts rates for my brick and mortar banking institutions and the highest one I found was 2.4% through my credit union. Many brick and mortar locations hover around 1% and their rates for CDs are comparable to what ING offers for a savings account.

The next benefit is the convenience that the ING online banking interface offers. The site is very easy to navigate and I can access my account (including my statements and history) 24 hours a day and seven days a week. You can view the interest that has accrued for the month on a daily basis. You can easily make deposits and withdrawals (to and from your linked bank account) with a few clicks. It is easy to set up an automatic savings plan that will help you reach your savings goals. You also don't have to worry about paper statements because you can quickly download your account history into Microsoft Money or Quicken and you can also print your quarterly statements at any time.

In addition to offering great rates, ING frequently offers promotions to encourage new customers to create accounts and to reward current customers for their loyalty. For example, they currently have a promotion where current customers can receive $10 if they refer a new customer and that person opens an account with an opening balance of at least $250. The new customer receives $25 for opening the account. Last year, they had a "winter save up" promotion where customers received a promotional 4.75% interest rate on new deposits made between January 19^th and April 15^th.

If your budget includes "sub accounts" to save for different events such as vacations, escrow, gifts, or car maintenance, ING is perfect for you. Once you have created your main account, you can create an unlimited number of additional accounts which will be linked to your original account. I currently have a savings account for my daughter as well as a savings fund for Christmas, car maintenance, and our escrow. Each account earns interest independently and it is very easy to transfer money between accounts and also to and from your linked checking account(s).

When I have shared my excitement about ING with family and friends, some of them have expressed concerns about the security of an online banking institution. In addition to being FDIC insured, ING offers a number of security features to ensure that your money will be safe. First, they have a sophisticated encryption system that turns online transactions into an unreadable mathematical formula. In addition, when you create an account, you will choose a pin number. You will also create responses to a number of security questions, choose an image, and create a "login phrase." When you log in, it is a four step process. You enter your account number first, then responses to two randomly selected security responses, then you confirm your login image and phrase, and finally you enter your pin number. In the three years that I have banked with ING, I have never had concerns about their security.

ING does not charge any fees and you are not required to carry a minimum balance. If you need to contact them by phone, their customer service consistently receives excellent ratings.

The disadvantages

For me, the disadvantages are few, but they must be considered in assisting you to make an educated decision about whether an ING account is "right" for you.

The main disadvantage is the turn around time in transactions. There is typically a two to three day wait for money to be transferred to or from your account. (This could also be considered an advantage because you really have to think before you withdraw or spend the money.) In addition, there is typically a five day "hold" period after funds have been deposited to your ING account.

Another disadvantage is that they do not have any brick and mortar locations and they do not offer a lot of the "frills" that other banking institutions offer such as a network of ATM machines, checking accounts, and online bill pay features. You also have to have a checking account with another institution in order to create an ING account.

Summary

If you are looking for a savings account that provides high interest rates (allowing your money to grow quickly), great customer service, and easy access without all of the "frills" then ING is for you. To open an account, view current rates, or get more information, visit their website: http://www.ingdirect.com Their website also includes features such as financial tips and calculators and a special section called "Planet Orange" with suggestions for teaching kids about saving money.