Online Savings Accounts & Current Rates

[maat55]

The front post show's provident direct with 4.5 on savings and 3.75 on cd's. Why is the savings higher and is this a good place to put an ef and car fund?

[kork13]

I first found out about these online savings accounts sometime around yesterday, so I'm kind of overwhelmed with the sheer number of them I'm realizing are available...

Can anyone give me a recommendation on one, or a couple, that are good, high and (fairly) reliable with rates, easy to setup/use, and such like that? Like maat, I'd like to use one for my EF, and possibly another to just save away money for larger, planned future purchases (personally, additions to my photography equipment, sword/knife collection, and stuff like that ^_^)...

[maat55]

Is it just that easy, you setup an account, put your money in and earn 4.5%? Are there any catches?

[m3racer]

Check out bank rate and their rating system.

[Jazzmint98]

Shore Bank online savings is down to 3.30% APY effective 3/25.

[maat55]

I applied for the provident direct account paying 4.4. I'm going to start off with 25.00 and see if I can move it back and forth easily.

[weissheit]

Provident Direct

I opened an on-line Provident Direct account, at 4.50% apy (4.40%), no fees, no charges, no hidden expenses, except that withdrawals are limited to 6 transactions per month, else 5$ per transaction (withdrawal) in excess of 6 transactions p.m., and no $ cap on withdrawals.

The are a Mid-Atlantic regional bank and I think their online bank is less that a year old so they are trying to gain market share, hence they are keeping their rate high.

I like the fact that brick-n-mortar is tied into the online account. I live in the Metro DC area where they have a significant branch network + they have shopping market branches in a chain called "Shoppers Food Warehouse". So I've opened up a no-fee checking account & got an ATM card just in case I have a need to access these funds.

Bankrate's Safe & Sound ratings puts them at mid-tier, a rating most banks hold, so they are pretty decent in terms of stability.

[Aleta]

Does it state for how long that rate at Provident will hold? Some will pay out until a specified date. It would not be a good think to send your money there and the rates would go down next week.

[Jazzmint98]

I have also opened a Provident Direct account with a small initial deposit. I received a debit card to access the account, but it is difficult to transfer money since they don't have ACH transactions set up yet. There are no brick and mortar Provident banks in my area. You can't even transfer money online from the external account to the Provident account other than the initial deposit. The interest rate they are offering is good, but I'm not sure it is worth the aggravation until they get their online system more fine-tuned.

[weissheit]

I am sure that provident-direct will not be able to hold out forever and relent sooner or later as the FED continues its rate cuts. If you reside in the MD, DC or VA then by all means open an account and when they drop to an anemic rate you can easily move your funds. Everyone not in the geographic area for provident bank should weigh the hassle of setting up, transferring and withdrawing funds when they inevitably drop their current intro rates.

I actually assumed they would drop them after this last rate drop and already opened an everbank account to get at least 3 more months of 4.5% while staying liquid. Instead it was everbank that dropped their intro rates. 4.5% after inflation and taxes is more or less a break even rate, anything less and you're losing money. I will likely shift to muni bond funds except for my emergency cash reserves.

Credit Unions and their CD rates will likely be the last holdouts against current downward savings rate pressures.

Good Luck

[maat55]

I was on the phone with them monday and they said there is no problem with external access, I am starting with 25.00 to make sure I can move back and forth before I move my EF over.

[Jazzmint98]

I was on the phone with them monday and they said there is no problem with external access, I am starting with 25.00 to make sure I can move back and forth before I move my EF over.

According to the rep I spoke with, the external banks that are used to initially fund the account are processed in batches at the end of the week from when the account was opened. I've opened this account several weeks ago, so who knows why the external banking info was not entered in the system (so that transfers are possible). He fixed the problem and assured me that I could add more than just 1 external account. I've added a few more external accounts now. I hope everything is finally in place.

[weissheit]

Provident Direct

Provident-direct e-mail rate drop effective tomorrow 3.75% Make your decisions regarding opening and funding accordingly.

[maat55]

Right as I got setup, Then it drops. It must have been my rotten luck. Oh well, it still pays much more than my area savings.

[kork13]

Can't time the market... even if the 'market' is savings accounts