When shopping for the best bank rates, you are likely to discover that you can get a better rate at an online bank. Because Internet banks don’t have the costs of running and maintaining physical locations, they can pass on the savings to you in the form of better bank rates. But before you open up an account with an online bank, you’ll have to consider more than the rate you’ll get on your money.
Convenience factor
With an online bank, you simply can’t walk into the bank to make a deposit. Since there aren’t any physical locations, you’ll need to be comfortable communicating via phone, e-mail, text or live chat. Before you choose a bank on the Web, find out the process for communicating with the bank. You’ll want to know the primary means of communicating and the availability of help. Just by contacting the banks to learn information about bank rates will demonstrate the ease in which you can get in touch with the bank.
Making deposits and withdrawals
With Internet-only banks, making a deposit isn’t as simple as driving up to the ATM. Typically, you’ll have to have an account with another bank and transfer the money into your Internet account or mail in your deposit. Withdrawing money for some of the Internet banks is a lot less cumbersome. Some of the banks have relationships that enable you to withdraw money from ATMs. In other cases, you’ll have to do the transferring money from one account to the other via another route.
For some, having to transfer money back and forth is an added headache; but for others that, coupled with the better bank rate, will ensure they save money. Take into account your needs before choosing an online bank.
How to find bank rates
Once you’re ready to open an online savings account, finding the best bank rate doesn’t have to take hours scouring the Internet or making phone calls. Bankrate.com’s search tool can quickly tell you the rates online banks are currently paying for savings accounts.
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