Save More with an Online Savings Account

We are doing more and more from remote locations. We can work from almost anywhere, and check our email on the phone. I do almost all of my banking online. The only time I ever have to go to a bank is when someone sends me a check, rather than using PayPal, and I end up having to go deposit it. So it is no surprise that many companies allow you to open savings accounts online. Indeed, there are many advantages to opening an online savings account, and only some of them have to do with convenience.

One of the biggest reasons to open an online savings account is the higher annual percentage yield you end up with when you take advantage of the special rates offered online. While you are lucky to get something approaching 2% when you go to your local bank (and that very lucky), the average rates offered for an online savings account is usually more than double that - close to 4.5%. That means that your money works better for you. However, no matter how you slice it, you will never make the best returns on a savings account. Because there is miniscule (practically none) risk involved with a savings account, the returns are not as high as they would be with a riskier investment like stocks or real estate. However, it is good asset management policy to put some of your money into a safe investment, just so that it is there.

And if you are going to play it safe, with at least part of your financial plan, it is a good idea to look into getting an online savings account. At least that way you have a chance to earn more money. Banks like ING, HBSC, and Emigrant Direct offer special rates for those who open savings accounts online. Even Citibank offers specific rates, higher rates, for those who choose the online route. And it is possible for you to easily transfer your money into the account, and to monitor it from a secure Internet connection. You can even withdraw some of it as needed.

But before you transfer money into an online savings account, you should make sure that it is secure. And legit. Scammers try any number of schemes to get their hands on your money (or bet yet, your bank account number), and it is a good idea to carefully check on the bank you plan to go with. Make sure you are dealing with a reputable bank before transferring any money.

No savings account is going to offer a high yield, but you can get a little more for your risk-free investment by choosing an online savings account.