Each year millions of people make New Year's resolutions hoping to improve some aspect of their life. One of the top ten resolutions each year is to get out of debt and/or save more money. This year is no different, in fact more people are cognizant of the need to improve their personal finances. Building your savings is one of the best ways to ensure financial independence and avoid future debt. To successfully grow your savings you must know how and where to start the process.
Online savings accounts continue to grow in popularity and for good reason. In many cases online banks offer convenience and terms that are better than those found at a brick and mortar bank. Here we look at ways to find the best online savings account.
- Assess your needs- Before you begin your search, assess your banking needs and write down your savings goals. This information will help you when it comes time to compare different accounts. Online savings accounts can be a great tool for those just starting out or even for people who have established savings accounts. If you have substantial assets you want to compare both online savings accounts and those offered by more traditional banks as some banks offer better terms for accounts with a higher balance.
- Compare rates- As previously mentioned one of the benefits of using an online savings account is the increased amount of money you can earn with higher interest rates. Each account offers different terms and conditions therefore you must carefully compare all banks and the individual accounts offered by each to find the one that best suits your financial needs.
- Compare features- The best online savings account will offer not only competitive rates but also other features which make your life easier. You are specifically looking for how long it takes to transfer money in and out of your account, whether or not you have access to a physical location should you need in person assistance and what other options are available beyond the standard savings account.
- Do your homework- Before depositing any money into an online savings account take the time to research the institution. Avoid problems in the future by making sure the bank is FDIC insured. There are several popular websites that compare and review online savings accounts. Current or previous account holders may comment on these sites offering personal experience which can help you decide if a potential bank is right for you.
Online savings accounts are good for more than just saving money. You can also open hybrid accounts where you can not only save money but also pay bills like you would from a traditional checking account. Regardless of which bank or account you choose, know that making the effort to save money today will improve your personal finances in the months and years to come.