My Online Savings Accounts

March 3, 2007

piggy bank 1

I talked about how important it is to have an emergency fund in a previous post. Now I’m going to talk about some great places to park your emergency fund and earn a great interest rate too! All of these are high yield savings accounts that I personally have and use. All of these accounts offer FDIC insurance protection on deposits up to $100,000 (joint accounts for up to $200,000) so you don’t have to worry about losing your money. It is 100% safe and completely backed by the government. All of them also have no minimum balances to open or earn interest.

Amboy Direct


I actually have most of my emergency fund in Amboy Direct because of their superb regular rate of 5.25% and 5.35% with $20,000 or more, which beats nearly every other online savings account with no minimum balance requirements. In addition to that, their customer service is excellent! Every time I’ve had a question or anything else, they have answered both phone calls and emails promptly. One slight shortcoming is the interface. It is very functional and offers tons of details, but it really needs a face lift. Transfers are fast and easy to schedule.

If you’re really serious about this “emergency fund” thing, have at least $3000 that you plan on keeping there for at least 90 days, and want $25 free, contact me or leave a comment and I will send you a link to earn $25 for free (full disclosure: I will earn $10 also; it’s a win-win!).

HSBC Direct


HSBC Direct has a great promotion going on now through April 30, where new money earns 6 percent interest! If you don’t already have an emergency fund and you’re just getting started, HSBC Direct is a great place to start, especially since they have an excellent introductory rate of 6%! After April 30, the rate will return to the current regular rate which is 5.05% which is still better than most banks! Their website also offers many security features that put it apart from other online banking websites including an insanely long 20 digit customer ID used to sign in as well as a password and security key (a number that is clicked on a virtual keyboard to help against keyloggers which attempt to steal passwords by the keys you press).

Their interface is great and customer service seems to be pretty good considering I haven’t used them much, if at all. ACH transfers from your external accounts into and out of HSBC seem to take the standard 3-5 business days, even maybe leaning towards the five business days. I would actually recommend Amboy over HSBC especially because their normal rate beats HSBC’s regular rate.

Washington Mutual


I reviewed Washington Mutual’s savings account in another post so you can read about it there. Their current rate is 5% and it also gives you the convenience of a local bank. I don’t use them for my emergency savings only because the cash is “too accessible” if that’s possible. Since it’s so easy and quick to transfer from my savings to my checking, it’s also easier to spend. I actually prefer keeping my emergency savings in an external online account that will take 3-5 business days to transfer over so that I’ll use it solely for emergencies and not on impulse purchases. But if you are planning on opening a new checking account, you might as well get a savings account that offers 5% for that “short-term money” that’s usually not earning high interest.

ING Direct


I can’t talk about online savings accounts without talking about the pioneer in high yield savings accounts, ING Direct. They are the one’s who started it all, and the model that everyone else copied. If you’d like a free $25 bonus for opening an account (full disclosure: I get $10), and you’d like to open an account for at least $250, contact me or leave a comment and I’ll send you a link for the free $25. That’s an easy 10% gain on your money with little hassle.

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