The prospect of opening an online savings account is appealing to many consumers, especially given the attractive interest rates, lack of minimum balances, and great incentive offers that nontraditional banking institutions can provide. Online savings accounts can also be confusing, especially for a customer new to Internet banking. However, the process is actually simple and easy. There are only actually 5 things the customer should have available in order to open an online savings account.

Why open an online savings account? Online banks have lower expenses than traditional banks and so are able to pass these savings on to their customers. Additionally, Internet banks offer many of the same benefits as traditional banks, including ATM cards and online bill pay. When choosing your Internet bank, the cautious consumer should be sure to choose one that is a member of the FDIC (Federal Deposit Insurance Corporation), so that deposits are insured up to $250,000.

Here are 5 things necessary to open an online savings account:

Personal contact information. The customer will need to provide a mailing address, including a street address, city, state, and zip code. A P.O. Box cannot be used to open an online saving account. One primary phone number is needed as well, although, additional phone numbers will be requested.

Email address. The customer will need a valid email address in order to open an online savings account. Most Internet banks will send out a verification email in order to confirm that the email address is correct and legitimate. A free email account such as Hotmail or Gmail is usually perfectly acceptable.

Date of birth. The Internet bank will require that the consumer supply their date of birth at the time of application.

Social security number. The Internet bank will require the customer’s social security number at the time the online savings account is opened.

Existing checking or savings account information. The consumer will need to provide the Internet bank with the routing number and account number of an existing checking or savings account. This information is needed is so that money can be transferred electronically in order to establish a new account balance.

The customer should be sure to have the 5 things listed above on hand before beginning the application process. After it is completed, the bank will send out a signature card, and request that any required supporting documentation be mailed in.

Opening an online savings account is remarkably easy and convenient. The benefits of opening an online savings account are many, and the Internet bank will make the process simple. An online application form will walk the consumer through the entire process.