Interested in a high yield savings account or free checking account? This online bank offers a combination high yield savings and checking account with a high 4.00% APY.
Update as of 9/26/08: WaMu is a bank in the midst of transition at this point in time. It has lost its independent standing and has been bought out by J.P. Morgan. Customers shouldn’t worry as their deposits are safe with J.P. Morgan, and they’ll continue to have access to their accounts. More details in my article: WaMu Got Its Emergency Bailout With A J.P. Morgan Buyout. Also, since we published this article, interest rates have gone down significantly, which will be reflected in current savings account yields.
Because of these changes, we no longer offer sign up access to WaMu’s free checking and high yield savings account through this site (you may find options by going directly through J.P. Morgan); however, if you are interested in available alternatives for your savings, please see this list:
Online Savings Accounts
- The E*Trade Bank Complete Savings Account
offers 0.50% APY.
- The WTDirect Savings Account will now give you a 1.51% APY for the first 60 days. After the first 60 days, you’ll need to retain a balance above $10,000 or your APY will be reduced to 0.50%.
- HSBC’s Online Savings Account
will earn you 1.35% APY.
- ING DIRECT’s Electric Orange Account will earn you .25% to 1.55% APY.
- The FNBO Direct Online Savings Account currently offers 1.50% APY.
You can also read up on these recommendations in our article on online bank accounts.
If you’re interested in reading more about WaMu anyway, please check out our earlier review below.
We’ve been with one particular bank forever, and it’s also one of those banks that’s been around forever — very stable and entrenched, especially in California. I’ve even worked at this bank for 4 years so I’m reasonably aware about how well it’s run.
Inertia has kept us from looking into the details of our most basic accounts over the last several years and though we’ve paid many fees and suffered through paltry returns from our checking and savings accounts, we’ve stayed loyal, as I’m sure most people have as well (with their own institutions).
But lately I’ve been investigating alternatives, just to see what other options there are out there. I’ve looked into ING Direct and now have also been interested in reviewing Washington Mutual’s latest promotion, which includes “sweeter savings” with 4.00% APY if you open a WaMu Free Checking and Online Savings combo account.
Basically, if you open an online savings account with them and link it to their free checking or other one of their checking accounts, you’ll get the special APY (applied to savings).
Their online offer includes:
- Minimum opening deposit of $1.00
- No monthly fee
- 4.00% APY when checking is tied to online savings
- Free checks for life (on a default design; you’ll need to pay for other designs)
- Free ATM cash withdrawals (but there may be non-refundable ATM operator fees)
- Foreign currency exchange and transaction fees may still apply
- Gold Debit MasterCard with rewards (not the most exciting rewards, but thank you)
- Free ID theft insurance up to $5,000 and ID theft services
Of course, these are all features they promise their customers, but we all have to watch out for the fine print. And I won’t be the way I am without being skeptical about a new service or product I’d like to try out. But already I see that they’re superior to our current bank about a few things: I don’t need to maintain a certain minimum to escape monthly charges, and I’d be earning a return on what virtually is a checking account. Plus I won’t be annoyed about getting charged for checks, especially since I don’t care about check designs. I always wonder why anyone would….we’re not at the receiving end anyway! 
Nevertheless, it’s something that sounds pretty good on the surface and barring some of the macro-issues that this bank has been facing recently due to loan industry woes, I’m inclined to check them out. Like any checking or savings account out there, a WaMu bank account will be FDIC insured no matter what.
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Given that my Etrade is down to 3.1% it may be worth a look. I wonder if it is a limited time thing, like first 6-months.
WaMu has been beaten up pretty bad over lending practices too, so maybe they are just trying the old-fashioned principle of buying some clients, and then trying to load them later.
You should check out bankrate.com for a list of all the top savings/checking accounts out there.
everyone jump on this deal, because i own wamu stock. thx in advance. lol
@RacerX,
Yes, I did check on what’s going on with them. Their site does not say anything about a limited time offer and the rate applies to all their saving tiers, whether it’s $0 to $9,999 or $10,000 and above checking/savings balance. However, they do state in fine print that their rates are subject to change, which is the standard company line.
I told my husband about this as it seemed interesting and he, a big fan of macroeconomics and scary financial news
, pointed out the current events behind WaMu as far as stock and loan issues of late.
But there were these points to think of: accounts are FDIC insured plus I’ve seen some negativity also cloud my previous employer despite the fact that it is one of the biggest banks out there. So the loan problems have a huge outreach and affect most financial institutions. Seems like something you can’t escape these days no matter where your money is parked.
@John,
Yes, I’ve checked bankrate. Some of the info doesn’t seem like they’re referring to the same financial products, but I could be wrong…? I’ll check out the info more carefully.
@Tim,
Good luck with your investment!
You’re not alone — the financial industry as a whole is in the doldrums.
I signed up for WAMU’s Online Savings account earlier this year and I really like it. Been banking with them for about 6 years, but had my savings over at Emigrant Direct. When Emigrant’s rates dropped like a rock I looked at the new WAMU account. Signed up online and now I can do instant transfers between checking and savings instead of having to wait for the transfer to clear.
I used WAMU for about a year until I got married, at which point I found out that for a few operations they require you to visit a branch location (such as opening joint accounts). This doesn’t work for us because of distance to the nearest branch, so I mostly stopped using them. I like their products, but I recommend checking if there are any reasons that you might be required to visit a branch.
Thank you for this feedback! I was actually happy to find out that we had a couple of branches close to where I live, even though I happen to be holing up in the boondocks….
But yes, access to a nearby branch becomes a must when you’re required to do some banking tasks in person.
But yes, convenience can be an issue for many, particularly when you’re dealing with banking. It’s not as big a deal with online investing where you won’t need to worry about brick and mortar locations given the long-term nature of your investment transactions.
Tim: Good luck with that stock!!!!!
jdauie: Maybe you can try HSBC. They offer an even better rate and I’ve never been in their branches before. They aren’t really known in the US but they are huge internationally (bigger than WaMu I’d say).
Hi I like Wamu as well. We’ve had their free checking for quite a while & I’d also like to mention they allow one free reversal of their overdrawn fees per year and they have wamu for kids where they give $ to the school of your choice based on your purchases. Sort of like escrip. We’ve been happy with them & like the ease of transferring between wamu & my usaa savings never had problems in 6 years I’ve been doing it.
I missed Wamu when we lived in mass.
Aloha
I agree it is worth considering. It has FDIC insurance. But the bank is not very stable. The stock price, for example, was above 40 in the last year. It is below 5 now. But as long as your entire deposit is covered by FDIC you are in safe (though if a bank goes under – not that likely – there can be a delay in getting your money). Normally a bank’s assest would be bought out by another bank.
I switched to WaMu over a year ago when they started this promotion and a 4.0% APR. I’m very happy with their service and support. The couple of times I’ve gone into a branch I’ve found the people to be exceptionally friendly and helpful.
I keep the majority of my money in the savings account and transfer over whatever I need to pay bills. If you do this make sure you go into a branch (or call customer service) to request they link your accounts with overdraft protection. If you open your accounts online they’re not linked for overdraft protection and if you screw up the timing of a transfer you’ll get hit with overdraft charges.
Yep, we signed up for WaMu specifically for this high interest savings account. It helps too that it’s only walking distance from our house.
Just the other day, I found out that I can do FREE international wire transfers from the checking account that’s linked to our savings. We usually send money overseas and it costs us anywhere from $10-$14 dollars per transaction. Just another reason I like WaMu.
What a timely post! I was just looking into this exact offer also and I think I might pull the trigger soon. Please keep us updated if you decide to go through with it.
I wouldn’t worry about the bank’s stability. That is exactly why you are getting a good rate. As long as your account is kept to $100,000 or less you are fully covered by FDIC. In that case, access to your money will not be delayed for more than 24 hours. They have a very good track record with taking over banks.
I am guessing the checking balance doesn’t give interest?
I have been with ING checking and savings for a year or so now, and I love it. A few things I really love are :
the free e-checks and free online paper checks. I buy a book or two of stamps a year now. The transition to no paper check book was little challenging, but well worth it.
Interest on my checking balance.
Instant transfers. I suspect Wamu has this.
Unlimited number of savings accounts. I think I have 12 right now. I love having separate savings bins.
Almost free overdraft coverage.
Great website and customer support.
Two dislikes. Quicken integration isn’t good and the rates aren’t cream of the crop anymore.
Great news! WaMu’s online savings and free checking account promotion now offers a rate increase from a %3.30 APY to a really enticing %3.75 APY. So if you’re interested in that high yield savings AND checking account, sign up with WaMu
while the offer is available.
I’m not sure about this checking account. I’ve checked out the fee sheet and it’s loaded. Well at least for those that have issues with money management. They do offer a free overdraft in case you ever make a mistake but after that it’s about 35 dollars.
I’d probably go with one of those new high yield checking accounts. There are a lot of better offers out there.
Hmmmm…take a look at your online savings rate now.
Ed: Please take note of the date this article was published. Yes, interest rates are going down, and WaMu’s (or JP Morgan’s) rates should be headed the same direction.