Best High Interest Savings Accounts In Online Banking

We provide a list of the best high yield savings accounts available.

These days, the “high interest savings” label seems more like a misnomer. The thing is, we’re all facing lower rates across the board, as many of the best rates we’re seeing for liquid savings accounts are currently lingering at 2% APY or lower. Let’s take a look at some of what’s considered as “high yield savings accounts” in this low interest rate environment:

Best High Interest Savings Accounts In Online Banking

Although these banking options are sporting lower rates, they are still relatively higher than the average interest rates you may encounter at banks and financial institutions around the nation. Plus, these options also score well for other features in online banking, which we’ll cover further in this article. I am partial to those banks that offer brokerage services along with banking services since this makes it easy for me to consolidate my money management under one umbrella.

Online Bank APY Rate Min. Balance EverBank 2.51% $1,500 Ally Bank 1.64% (Updated 11/19/09) $0 WT Direct 1.51% $1 FNBO Direct 1.50% $1 HSBC Direct 1.35% $1 ING Direct Savings 1.30% $1 ING Direct Checking .25% to 1.55% $1 E-Trade 0.50% $1 Bank of the Internet 1.65% $1 Dollar Savings Direct 1.60% $1,000 Citibank e-Savings 1.01% $100 VirtualBank Savings 1.01% $1,000

So what do you look for when shopping for an online savings account? It’s true that for some customers, it’s all about finding a solid bank to park their funds while they await a more stable stock market, to others, it’s still all about finding the highest savings account rates. In my mind, there are other considerations that one may have when opening a high yield savings account. For instance, I prefer to take a look at all the features offered by a bank to determine if I should become a customer.

What Makes A Good Online Bank?

Here are some factors for choosing a high interest savings account, particularly in the online banking realm:

1. Stability and Reliability
How solid is your bank? Sure, savings accounts and many other conservative bank products are FDIC insured and backed by our government, but it’s easier to sleep at night knowing that your bank isn’t on the government’s “troubled banks” list. I prefer to be assured that my savings are sitting somewhere stable and safe.

2. Information Security
You may be wondering just how safe it is to bank online. In reality, banks have gotten very sophisticated about ensuring the security of your information online. Add on the fact that by going paperless, you’re less vulnerable to acts of fraud often committed by those who may get access to your paper statements and mail. Online access also makes it easier for us to notice suspicious activity against our accounts right away.

3. Customer Service
Ever get caught in voicemail hell? Do you find yourself frustrated with your bank over minor matters? I wouldn’t settle for less. Find those companies where customer service reps are responsive and knowledgeable about the products of their company.

4. Website Usability and Performance
How good is the bank’s website and online connectivity? If you’re going to put your money in an online bank account, your online site experience will matter greatly. See if your bank’s site is user friendly, intuitive and uncluttered — if they’re slow and cumbersome to use (there are more than a few out there), I’m more likely to take my business elsewhere.

5. Brand Name Recognition
Although there are great banks, thrifts and credit unions that have their share of loyal customers, I think it’s unlikely that you’d go wrong with a bank that harbors a strong reputation and highly recognizable name.

6. Brick and Mortar Branches
Not all online financial companies exist in a purely virtual capacity. There are banks with brick and mortar branches that have expanded into the online realm in order to cut costs and offer higher yields. Bigger banks like ING and HSBC have launched internet banking divisions that are separate from their main business.

7. Strong Track Record For High Rates
Of course, one of the main reasons why people sign up for online savings accounts is clearly the offer of relatively higher interest rates coupled with liquidity. If you’re a rate watcher, you’ll see that there are banks that have a history for maintaining competitive rates (we offer a list below) vs others that fall behind the pack.

Aside from what I’ve already mentioned, there are also these features to consider in a high yield savings account: how easy is it to qualify for an account (how much is the minimum deposit you can afford), the availability of helpful tools and information, as well as connectivity to external accounts you may have.

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• Earn top returns: FNBO Direct [1.90%], HSBC Direct [1.65%], WTDirect [1.76%], E*Trade Bank [0.95%], ING Direct [.25% to 1.65%]
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