The best online savings accounts for August 2021

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    Online banks offer higher interest rates than stationary banks. That means it is now worthwhile to store cash in an online savings account as you have fewer overheads. As online banks struggle to be your new online bank, they tend to offer higher returns.

    Online banking is safe, FDIC insured, and a great way to get interest on your money as it is protected. But which online banks will offer the best savings accounts in 2021? If you are looking for a new savings account, check out our latest list of the best online high interest savings accounts available to you below.

    The best online savings accounts

    Banks with the best savings accounts

    Here are My Millennial Guide’s picks for the best savings account rates from top online banks.

    The prices apply from August 2021.

    CIT Bank 0.40% APY (tiered) – By rewarding those who actively contribute to their savings, the CIT Bank Savings Builder account helps people build their savings accounts while developing good saving habits. You need $ 100 to open this account, but there are no maintenance fees and you conduct almost all of your transactions through the app.

    Discover Bank 0.40% APY – If you are unsure about banking online, consider using a reputable, established company like Discover Bank. Toll-free savings, check, and money market products, plus industry-leading interest rates, make Discover Bank a great option for online banking.

    Synchronous bank 0.50% APY – Similar to other banks on this list, Synchrony Bank offers an annual percentage return that is well above the national average. If you’re looking for a high-income account to grow your savings, but also want ATM access to your funds, Synchrony is a great choice.

    Ally Bank 0.50% APY – Ally has high prices, low fees, an easy-to-use app, and great customer service. There are no physical branches for Ally Bank, but they do offer $ 10 monthly credit to pay off ATM fees, so you can easily use an ATM if you need to.

    Barclays Bank – 0.40% APY – Barclays has no physical offices in the United States, but it makes up for it with a very competitive annual percentage rate of return. There are no monthly fees and no minimum balance to keep.

    Other banks with high interest rates:

    CIT Bank Saving Builder [Our Favorite Online Savings Account]

    If you’ve ever thought about putting money in a high yield savings account, now is probably the right time to do it. CIT Bank has an amazing 0.40% APY rate. That is more than 19 times the national average savings rate! You can open a new savings account with a low minimum deposit requirement of $ 100 and it’s that simple. With its amazingly high APY and excellent service, CIT Bank offers a great example of what you can receive in an internet bank. If you are interested, you can find out more here.

    To get the 0.40% APY on the Savings Builder account you should keep a balance of USD 25,000 or simply open the account with at least USD 100 and deposit USD 100 monthly. If you have less than $ 25,000 or don’t make monthly deposits of $ 100 or more, you will receive a variable rate of 0.25% APY.

    How to open an online savings account

    You will need some basic information in order to open an online savings account. If you have a co-owner for the account, you will also need their information. Typically, you’ll need to provide your name, current address, other current addresses if you’ve recently moved, and your social security number.

    When you’re ready to open an online savings account, make sure that the online savings account has the features that most people use.

    The benefits of the best online savings accounts

    Most Millennials love opening a savings account as much as collecting the $ 100 for Passing Go in a game of Monopoly. You are putting some money into a high-interest savings account that you will only touch on the proverbial rainy day. If you live in Phoenix, your savings account will stay untouched for most of the year (haha). On the other hand, there are rainy days for Seattle savings account holders.

    A savings account sounds like a boring way to stash money, but you can spice up your finances by considering six features that define the best high-interest savings accounts.

    1. Be interested in interest rates

    The Consumer Federation recently released a report that said only four percent of US-based banks pay interest on savings accounts greater than 0.25. Money market accounts pay higher interest rates, but you have to keep a much higher minimum balance and pay more transaction and account management fees. When shopping for the best savings account base rate, you need to research the interest rates banks pay for customers who open an online account. Many banks, like CIT Bank, offer online savings accounts that pay nearly 0.40% APY (some of the highest rates in the country). You will never get rich opening a savings account, but you still want your hard earned money to work for you in the form of the best interest rate.

    2. Automatic deposits

    When you take on a new job, part of the new employee focus is filling out a form dictating how your paycheck should be deposited. We all want a large part of our salary to go straight to a checking account. However, the best savings accounts like Aspiration have an automatic deposit feature. “Most people don’t have the time or discipline to make regular contributions to saving themselves,” said Steve Brobeck, executive director of the Consumer Federation of America. Choose a bank that will transfer a certain percentage of your salary to your bank account every week. Even better, some banks make automatic transfers from the checking account to the savings account once a month.

    3. Low monthly fees

    Running savings accounts shouldn’t cost banks a lot of money. After all, transaction activity for a typical savings account is nothing more than regularly scheduled automatic deposits. However, banks are happy to charge fees for everything from withdrawing too much from a checking account to sneezing while you wait in line to make a money market transaction.

    Savings account fees vary depending on the type of account and the average monthly account balance. Imagine a bank that charges less than $ 2 a month in savings account fees and avoids banks that charge a monthly minimum balance fee.

    4. Access to cash

    Liquidity, which is often associated with financial terms, is relevant to savings account holders. You want instant access to your savings account cash through online transfers and ATM withdrawals. You may need a significant amount of cash in an emergency that your checking account doesn’t cover. A Federal Bank Act only allows six savings account withdrawals per month. Some banks allow fewer than six savings account withdrawals per month, and in addition, banks impose transaction fees to give you access to your funds.

    5. Deposit insurance

    Deposit protection in savings accounts is a breeze, but many millennials forget to check a bank’s policy on protecting hard-earned money. Federal deposit insurance protects savings of up to $ 250,000. Some of the highest interest banks have acquired Federal Deposit Insurance Corporation (FDIC) protection for savings account holders. This means that you don’t sacrifice savings account interest income just to feel reassured.

    6. Open an online account

    It’s not just the convenience of opening an online savings account. More and more banks are offering free online banking tools to help millennials save money. Here are some of the best online savings accounts to compare:

    Summary of the best online savings account

    Hope these tips teach you basic money management and what the best savings accounts do. Even if there is a lot of information to process at once, remember to start slowly and step by step. Before you know it, manage your personal finances like a boss.

    Check back soon as we update this list regularly. If you’re looking for the best money-saving apps, you can find them here.

    What advice would you give to a beginner looking to start budgeting and improve their money management skills?

    What’s next?

    If you’re struggling to save money, money saving apps to help you save automatically can get you on the right track. As you save money on a regular basis, you get used to it and start building wealth. You can see our favorites below:

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