Online Savings - monday 2009-02-02 1415 last modified 2009-02-02 1415
Categories: Nerdy
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I'm no financial adviser, but in tough times, making money work is essential. Online savings accounts are something of a stroke of genius, taking money out of brick and mortar institutions and getting to use it for their own loans and investments. Because the overhead of physical property and checking account maintenance is avoided, they can afford to offer much higher rates of return (annual percentage yield, or APY) than most well established banks, thereby leeching even more liquid funds. The only pre-requisite is that you have an existing bank account (again, genius; there's no due diligence on their customers since they've already proven themselves to another banking institution).

There are a good number of them out there. How do you choose? The Sun's Financial Diary has started to keep track of a history of interest rates offered for online savings accounts. I've taken the data and put it in Timeplot form for easier comprehension. As noted in that page, I have no direct business relationships with any of them. And as side/snide commentary, some of those banks have really, really bad names.

That isn't the full story, of course. Some accounts have minimum balances, others offer incentives, I'm sure still others have regular maintenance fees or brokerage options. It seems to me the most salient point in making a choice, though, is knowing how much money your money will make for you.

Comments

cool graph

I hadn't seen that graph tool before. That's nice.

And I'm also happy to see that my choice has done quite well: Everbank. I chose them based on their international availability - my local banks didn't have any idea how to get money from a European, and Everbank was quite familiar with the process. I think it would work with my local bank, but I was a little wary to make up the routing numbers that fit into the international format when my bank couldn't give them to me.

They had a nice introduction interest rate too, which was handy at a time when we had a bunch of money lying around.

Jon Daley on February 04, 2009 07:00 AM

How's the transa...

How's the transaction delay?

After having not logged in for months (years?) to my Mozilla add-ons account, I found they're using Timeplot as the chief statistical plotting mechanism for users to track their add-on deployment. Sweet. I'm waiting for some patches to roll in one of these days.

Ryan Lee on February 05, 2009 11:24 PM

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