Online savings accounts offer consumers many opportunities to help save money due to a wide variety of account features for managing one’s finances more effectively. Of course, not all consumers are familiar with online banks. Although a customer may be hesitate to move their savings account from a traditional brick and mortar bank to an Internet bank, there are substantial benefits to be realized.
Traditional banks carry many expensive overhead costs which online banks may not incur. Expenses such as rent on branch offices, the salaries of tellers, electricity and gas, water and garbage services are all operational costs traditional banks are likely to experience. An online bank probably has similar expenses incurred at the location of the headquarters office, but most online only banks do not have branch offices. Therefore, the operating costs of online banks are lower, savings which these institutions can pass on to their customers.
Among the attractive account features offered by online banks are savings accounts featuring lower or no fees. ATM cards are usually free, and many online banks will pay the charges associated with using other banks’ ATM machines. Overdraft fees may be waived altogether with only interest being charged on overdraft line of credit balances. Finally, online banks offer a variety of no charge services such as direct deposit, bill pay and electronic funds transfer. Your bank should provide a list of fees charged so that you can be sure you are obtaining a good deal on your online savings account.
Online savings accounts may offer interest rates which are higher than those given by traditional banks. Of course, it is advisable to comparison shop interest rates in order to obtain the best rate available. After choosing an online savings account, be sure to monitor interest rates periodically to be sure that you are still with the right institution. Of course, some fluctuations in interest rates are expected, but you want to be confident that your bank consistently pays competitive rates.
A customer accustomed to a traditional bank may be concerned that an online bank is not as convenient as the brick and mortar model. However, technology offers so many advantages in daily banking that many online banking customers consider this newer model to be both more convenient and efficient. Internet access assures that you are able to get your money 24/7, which is superior to traditional bank hours. Devices such as laptops and smart phones make your online savings account accessible anywhere.
Online savings accounts offer a variety of desirable account features which can help customers save money. Consider the advantages of lower fees, higher interest rates and convenience when shopping for an online bank.