I’ve been banking with FNBO Direct for years, mainly because their online savings rate beats the competition. I switched the majority of my money when they offered a promotional 6%, well above what I was earning with ING. But lately that great rate has fizzled before my eyes. Even last year when the crisis was developing they maintained a higher rate than their peers. Now after the latest rate drop they are level with ING at 1.5%.
I want my savings to work for me - or at least keep up with inflation. While there are many considerations when choosing a bank – customer service, security, and ease of access come to mind – I look first and foremost at the rate that bank is offering me for my money. FNBO does not rank first in many of these secondary considerations, but they always won out on rate. I’ll put up with a crappy, confusing site if it means more money each month. Now that their rate is level with ING, I am thinking I should switch my money back or look for a new bank that beats them both. I prefer ING’s site to FNBO’s, the layout is more logical and I like the information they give you like the current rate and interest earned to date.
Rates are low across the board right now and the 4%+ we earned in earlier years feels like a distant memory. The best I’ve seen is around 2% - from a bank I’ve never heard of. I have nearly $25,000 in my online savings account, I want to put it in the best possible place. It’s too much money to leave sitting around earning nothing. It’s time to research banks once again.
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7 comments:
I moved my EF to Dollar Savings Direct in January because they were paying 4% at the time. Now they are down to 1.98%. I haven't bothered to move my account because I can't find anything much better; I hope that you do and post about it:)
Do you rely on an account aggregator? If you do, be aware that ING and ED both don't allow them access to your accounts anymore. Big Frown.
I have most of my cash at Ally Bank. I've always found it easy to use. I also just opened an account with American Express Online Savings account (http://personalsavings.americanexpress.com/)... its new and offers 2%. ... what i am looking for is a good checking account somewhere. Any suggestions? What do you use?
Have you considered starting a CD ladder? I've been pondering starting small ones ($500 at Flagstar or Ally) but really haven't gotten started.
@Goat - nope, haven't seen anything better than 2% other than long term CDs. I have no desire to tie up my money for 5 years at 2.5%, I'm hoping rates rebound soon.
@Revanche - I'm hopelessly old fashioned, I log in to check my balances. But I know what you're talking about.
@Ace - Ally is one of the higher rate banks I saw, but I admit I haven't heard of them before. I take it you are happy? I still use a regular checking account, I haven't gone online yet.
@Kat - I hate the rates on CDs in general, except the one I have from last year at 4.25%. I don't want to lock in my money in this environment.
Check out American Express and/or Discover. Both just got into the banking business and now offer 2% online savings. Almost identical services to FNBO but higher rate.
Well, it's not surprising to have lower gains in this economy.
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