Take advantage of a high-interest savings account that’s conveniently online, with 1.10% APY, $0 monthly fees and more.
In the wake of the digital revolution, more banks have opted to expand their traditional banking services to include online transactions. Many banks now offer checking and savings accounts with on-the-go deposits, real-time balance updates and online transfers between accounts via web banking and mobile apps.
But with the arrival of these added features and online options, how can you decide which account is right for you?
What are the advantages of opening an online savings account with Discover?
Discover’s high-interest savings account offers several key benefits:
- High APY. This account’s APY is significantly higher than you’ll find with competitors who may only offer 0.01% APY.
- No minimum opening deposit. Other banks can require up to $100 open an account. Open a Discover online savings account with any amount.
- No monthly fee. You won’t pay a monthly savings account fee with Discover, potentially saving you $60 or more over other banks.
- Daily compounded interest. Some financial institutions offer accounts that compound and pay interest monthly. Discover compounds your interest daily and pays it out monthly.
- Online signup. You don’t need to leave the comfort of your home to open a savings account with Discover. All transactions are conducted online.
- Deposit on the go. Deposit your checks through Discover’s app by snapping and uploading a photo of your check.
What’s the difference between an interest rate and an APY?
Your interest rate is the simple interest you’re paid on an account or an investment over the period of a year. For example, if you’ve invested $1,000 into an account that comes with 1% interest, you’ll have earned $10 on that investment at the end of a year.
The annual percentage yield is a bit trickier. An APY is an annual rate of return that takes into account the effect of compounding interest over a year. In short, it’s the interest rate compounded monthly over the course of a year — or the total interest you’d yield if the account remained untouched for a year.
What should I look out for?
Discover’s rates and terms are better than what you’ll find at a traditional bank. But’s here’s what you should be aware before signing up.
- Limited monthly transactions. Discover limits your withdrawals and outgoing transfers to six a month, enacting a $15 Excessive Withdrawal Fee if you exceed it.
- Multiple fees. You could pay $30 for an outgoing wire transfer, $30 for insufficient funds or $15 to stop a payment, among other fees.
- One brick-and-mortar branch. Discover is an online bank with only one storefront in Riverwoods, Illinois. To withdraw money from your account, you’ll need to visit an ATM.
Find one using the ATM locator online or through Discover Mobile, but be aware that not all ATMs are free or even open 24/7. This could limit access to your funds.
How do I sign up?
1. Go to Discover Bank’s website.
2. Choose “Open an Account” and select the Savings product.
3. It only takes 4 steps to fill out your information, and you can apply for multiple products at the same time.
What information do I need to apply?
- Must be a U.S. citizen
- Be at least 18 years old
- Have a valid taxpayer ID
- Have a physical U.S. address
What other banking services does Discover provide?
In addition to its high-interest savings account, Discover offers several other banking and investment products that include:
- Checking accounts. Discover’s checking rewards you with up to $120 cash back a year, no monthly maintenance fees and unlimited online transfers.
- Money market account. Earn up to 1.01% APY with a balance of $100,000. Anything less, and you’ll earn 0.95%. You must maintain a balance of $2,500 or pay a maintenance fee.
- CDs. Discover offers flexible terms of three months to 10 years with rates of 0.35% to 2.35%, depending on the term.
- IRAs. Choose between a Traditional or Roth IRA CD, and enjoy interest rates of 0.35% to 2.32% with fixed terms that range from three months to 10 years.
What is Discover Bank?
You’re likely familiar with Discover for its credit cards and personal loans. But the online Discover Bank Savings Account brands itself as a simple, gimmick-free alternative to the traditional approach of brick-and-mortar financial institutions. It offers several account options for new customers and boasts a variety of free and flexible features.
Discover’s mobile banking is accessible through the free Discover Mobile app. Through Discover Mobile, you can pay bills, transfer or deposit money, check your account balances and locate nearby ATMs.
FDIC-insured, Discover works to ensure your money is safe and protected at all times, using proactive fraud monitoring, $0 liability protection and bill pay protection.
In addition to high-interest savings accounts, Discover offers credit cards, checking accounts, CDs, IRAs, student loans, personal loans and home equity loans. Discover is the sixth-largest credit card issuer in the United States.
Bottom line
Discover’s high-interest savings account offers the potential for convenient and significant savings with competitive interest rates, on-the-go transactions, no minimum account requirements and no monthly fees. As long as you’re comfortable keeping your banking transactions online, it’s a viable option for those looking to bank with mobility and save some cash.
