With the current interest rates being paid by traditional brick and mortar banks being so low, it seems that for convenience sakes you could just stuff your money under the mattress. You could forgo the .46% your bank was paying on your saving account and not have to deal with long lines, rude tellers, finding parking space and banker’s hours. What if I told you that you could still avoid the hassle of traditional banking and earn 5% or more on your basic savings account? Interested?
There are many online-based banks that are paying well over the current interest rates being paid by traditional banks. Many of these Internet based banks are paying over 4% and a handful are paying over 5% on basic savings. You don’t trust online banks? You may not know that many of the Internet based banks are the cyberspace-twins of traditional banks. Yes, some of the banks are pure Internet only plays, but most of them have been established by the brick and mortar banks to compete with the online banks. Not wanting to be left behind, these brick & mortar Internet twins are offering some of the highest rates on basic savings — most over 4% and quite a few over 5%.
The onslaught of traditional banks jumping to the Internet has revolutionized the online banking industry. The online banking industry is becoming very competitive with many of these banks are offering introductory bump rates that are higher than normal for a short period of time or offering to add extra money to your deposits to entice you to open an account with them. Many people have shunned the online banking concept out of fear of transferring their hard earned money into some cyberspace black hole never to be seen again. But with FDIC insured and well-known traditional banks such as Citibank, Countrywide and many others offering their services through their online businesses, online banks look to be a very viable option for a high rate of return on your savings account.
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