Gone are the days when a basic savings account was a practical means of socking away some cash.
Interest rates well below 1 percent promise minuscule returns and the typical big bank savings account serves as little more than a reserve to cover the odd overdraft.
There are relative exceptions but there exists barely any wiggle room for interest rates, which are set according to a federally stipulated minimum for commercial borrowing.
That said, U.S. News and World Report has published a list of what savings consumers may want to consider when opening a sensible savings account.
The ideal savings account doesn’t necessarily have to be one with a bunch of fancy features, the article detailed at money.usnews.com.
The main thing to keep in mind is that the money in the account should earn more that what it costs to be held by the bank.
The best savings accounts offer features such as:
- Few or no monthly fees
- Generous deposit and withdrawal limits
- Low minimum deposit and balance requirements
- High interest rates
- Guaranteed FDIC insurance
The magazine report continued, outlining that the right blend of these elements can be challenging, “especially because there is such a broad range of account types, tiered APYs and other factors to consider.”
The selected features of a savings account will mean the difference between a fruitful banking relationship and one that sees little yield.
The report includes excerpts of GOBankingRates’ annual Best Banks study and identifies the 10 best savings accounts.
The assessment included the top basic savings accounts from 90 national brick-and-mortar banks and 30 online-only banks, with criteria, such as fees, rates, deposit rules and minimum balances.
MySavingsDirect’s MySavings Account took top honor in the review. GOBankingRates found that the online account offers the highest APY on the list — 1.10 percent — and no monthly fees, no minimum deposit and no minimum balance requirement.
According to the review, account holders have the added benefit of linking the savings account to an existing checking account without having to switch banks.
Rounding out the list were:
- Ally Bank – 1 percent APY, no fees/monthly minimum balance, mobile deposits;
- American Express – 0.90 percent APY, no fees/monthly minimum balance/opening deposit requirement;
- Bank5 Connect – 0.90 percent APY, $10 minimum opening deposit, overdraft coverage for six free transaction;
- Barclays – 1 percent APY, no fees/monthly minimum balance, online transfers;
- Capital One – 0.75 percent APY, no minimum balance, automatic savings plan program;
- CIT Bank – 1 percent APY, no monthly fee, required minimum deposit of $100.
- FNBO Direct – 0.95 percent APY, no fees/monthly minimum balance, smartphone app;
- ß – 1 percent APY, no fees/monthly minimum balance, mobile banking; and
- Synchrony Bank – 1.05 percent APY, $5 monthly balance fee, $30 minimum balance fee, ATM card.
