Best Online Savings Accounts of June 2023

The primary benefit of a savings account is that your money grows with interest rather than simply sitting in a regular checking account. The Annual Percentage Yield (APY) rates you will get these days on savings accounts are quite high compared to previous years, as the Fed has continued raising interest rates to fight inflation. Current APYs for savings accounts sit at about 0.33%. So although you’re not going to make millions from your deposits, a savings account is a financially responsible way to get some return on your money.

Savings accounts are an ideal fit for people who want to set aside money for an emergency fund or are trying to save for a specific purchase, such as a house. You can link your savings accounts with your checking account and set up automatic monthly transfers so you can ensure you’re setting aside money each month towards your savings goal.

When it comes to online banking, you can quickly see all the different savings account options currently available. This allows you to quickly compare the high APY rates, fees, and other account perks with one another. You also have much more flexibility in managing your money and keeping track of your finances in real-time. This article will take you through everything you need about online savings accounts.

All major banks have an online presence. This is no surprise, as people want the modern convenience and flexibility to manage their finances with the tap of a few buttons, rather than going into a physical bank branch. These days, there’s not much you can’t do when it comes to online banking.

Most banks will offer a range of savings accounts you can open online. You can take a look to see which option is the best fit for your situation. The process of opening a new savings account doesn’t take much time at all, so you can get started saving very quickly.

There are a few different types of savings accounts that you will likely come across. Each will be tailored towards a particular set of needs, having its own set of pros and cons. It is a good idea to be aware of these different options, so you can choose one that is a good fit for your needs. Here are some of the most popular types of savings account you will see:

Regular Savings Accounts

Standard savings accounts can a good fit for both short-term and long-term savings, especially if you’re just starting out. The APY rates will usually be lower for a regular savings account when compared to the more specialized options we’ve outlined below. But if you expect to need to make regular withdrawals from your savings account, a standard savings account may be your best choice, as other types of accounts will charge extra fees the more withdrawals you make.

High-Yield Savings Account

If you are looking to get the best APY rates possible, then high-yield savings accounts will be worthwhile to consider. You will get a greater APY rate than a regular savings account, allowing you to grow your savings faster. But in return for the higher rates, you will normally have less access to your money. Expect to be limited on the number of monthly transactions you can make. High-yield savings accounts also typically require a higher minimum deposit to open up compared to a standard savings account, so they may not be the best option for people with limited funds.

SEE: Simple Savings Calculator

Money Market Accounts

These types of savings accounts combine many of the aspects of a checking amount with those of a regular savings account. The APY rate will often be better than those offered in a regular savings account and you will also have the option to use a debit card to access your account funds. There will usually be a monthly fee charged for these types of accounts, with a higher minimum required deposit, similarly to high-yield savings accounts.

Certificate of Deposit (CD) Accounts

CDs are a way for you to earn a return on your money that will be fixed for a certain period of time. With a CD, you are agreeing to leave your money in this account until the CD matures. Some CDs will have term lengths of just three months, while others might take ten years to mature.

You will be able to lock in an APY rate for the entire period, with this rate usually being better than most other types of savings accounts. CDs have a tiered APY rate system depending on how much you deposit and the length of time you are committing these funds – the longer you commit to keeping the money in the account, the more interest you can expect your money to earn (today’s CD rates are around 1.24 – 1.55%). If you find yourself needing to withdraw some of the money before your CD matures however, expect to pay a penalty fee.

The advantages of using an online savings account are plentiful. You can quickly see all of the different online providers and compare them with traditional bank offerings.

When choosing the online savings account, you can easily shop around for the best APY rates or a particular type of savings product that fits your goals. You can set yourself on a path to financial success as your money will be earning interest, rather than just sitting in the bank. As one of the most common financial products, you have a great range of different types of savings accounts to choose from, so chances are you’ll find something to suit your needs.

Online banking itself has endless advantages. Most notably, you have the ability to efficiently conduct important banking processes from the convenience of your mobile phone or computer. You can also keep an eye on all transactions in real-time, making sure that nothing untoward is happening.

There are not too many drawbacks associated with using online savings accounts. Namely, some people who are not very tech-savvy might prefer to conduct their banking in-person. Additionally, although interest rates are higher than usual in the current economic environment, the potential for return on the money in your savings account is not as high as it could be from riskier investments, such as stocks and bonds. However, if your money is sitting in the bank regardless, you might as well be earning some sort of return on it.

• Research: It is important that you research the various savings account types to see which will be the best fit for your needs. It is vital that you only consider online providers and banks that have built up a strong reputation for treating their customers properly.
• Account type: Once you figure out the type of savings account you need, you can shop around for the best rates. This can be easily done through Lendstart, as you will find expert reviews of all of the leading providers of online savings accounts. This will save you a lot of time and hassle.
• Minimum balance requirements: Minimum balance requirements refer to the amount of money that an account holder must maintain in their savings account to avoid fees and penalties. These requirements vary by the financial institution and account type, and they can range from as little as $5 to thousands of dollars. For those looking to open an online savings account, it’s important to consider the minimum balance requirement as part of their decision-making process.

Getting started with an online savings account doesn’t take too much time. Once you identify the category of savings account that will be the best option for you, then you can start looking for the bank that provides the best terms for this account type. Lendstart can help during this process, giving you a comprehensive insight into all core aspects of your savings account options.