Online Savings Account

A great way to earn extra money due to interest would be opening an Online Savings Account. Online compared to Brick and Mortar Banks is extremely lucrative (comparison below). The accounts are developed to “piggy-back” onto your original checking account. The concept is great, because if you need the money you can simply transfer it back into the savings account. Keep in mind some if not all have transfer limits monthly. Other than the tremendous interest opportunity some OSAs are easy to open with Minimum Opening Value, No Minimum Balances, and No Monthly Fees.

How Much Can I Earn?
Your current checking account pays nearly nothing most likely. I know for sure my Bank of America savings is .02 percent While my FNBO Direct earns a nice 5.05 percent. Let’s conduct a little interest experiment between $50 contributions with 5.0% and .20 %

I know $50 a month isn’t much, but a penny saved is a penny earned! The money will add up take a look…

  • 5.00 % and $50.00 contributions for one year = $613.94
  • Bank of America at 0.20% and $50.00 contributions  = $600.55
  • Total difference between Bank of America and 5.00% = $13.39
  • Increased with 200 monthly at 5.0% for a year = $2455.89

As you can see to be the largest bank in the world their interest is horrible. Now they do have interest savings account much higher (2-4%) but these accounts are minimum of thousands of dollars. Take my advice and open a OSA today.

Here is a small compiled list of popular Online Savings Accounts/Banks.

FNBO Direct:
5.05% APY, $1 to open, No Monthly Minimum Balance.

Emigrant:
4.75% APY, $1 to open, No Monthly Minimum Balance.

HSBC Direct:
4.50% APY, $1 to open, No Monthly Minimum Balance.

ING Direct:
4.30% APY, $1 to open, No Monthly Minimum Balance.
Incentive – $25 Account Opening Bonus

Do you know of more that should be added? Comment on this, and I’ll update.

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2 Responses to Online Savings Account

  1. WarriorBlog says:

    Hey Alex, thats awesome that you are saving your money (very intelligent).

    “I know $50 a month isn’t much, but a penny saved is a penny earned! The money will add up take a look…”

    What a humble sentence 🙂 . I totally agree with you here. Many will spend from what they made and a little more beside that (no wonder they’re in huge debts).

    I am also practicing this habit of saving every month. If you keep this up, you won’t ever have to worry about money 🙂

    ———————————————–

    Hey Alex, if you’re wondering how I come up with these posts on my blog… I alway keep a journal and write every ideas I come up with, even if it sound ridiculous. I also read a lot from many forums.

    Keep up the work Alex and take care,
    Sean

  2. alexrector says:

    Yep, frugal living is the way to wealth!

    Don’t worry, I’m right beside you paddling in the same boat!

    That’s a good idea on the journal. I don’t do that personally, but I could really benefit from it. My own ideas are just from daydreaming and creativity.

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