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June 8, 2023 by Brett Tams

If you have a savings account, how much interest does it earn? Probably not enough. And if you don’t have a savings account, why not?

A savings account isn’t meant to make you rich. It’s a safe, if not very sexy, way to plan for your future and protect your money. But things get more interesting when you choose a high-yield savings account instead of a traditional savings account. A traditional account will pay pennies on your balance, but a high-yield savings account can help you earn extra money you’ll actually notice.

But how do you choose a savings account when there are so many out there? We did the research for you. These are the top high-yield savings accounts with the best interest rates, features, and benefits.

What’s Ahead:

Best high-yield savings accounts

The Ally Online Savings Account is our top pick for the best high-yield savings account overall because it consistently offers a competitive interest rate and includes features to help you save. For beginners, the Discover Online Savings Account might be a better option thanks to its simple platform and above-average support. The CIT Savings Account is our second runner-up because it has the highest APY of the bunch but does come with a minimum deposit requirement.

We also considered the Axos Bank High-Yield Savings Account, High-Yield Chime® Savings Account, Capital One 360 Performance Savings Account, and Marcus Online Savings Account for our list. Even though these didn’t make our top three, they’re all good choices well worth checking out.

Best overall: Ally Online Savings Account

Ally Bank's logoPros

  • No fees
  • No minimums
  • Boosters to help you save faster

Cons

  • No branch locations

Features

  • Minimum balance: $0
  • Minimum deposit: $0
  • APY: 2.50%
  • Monthly fee: $0

The Ally Online Savings Account is the best high-yield savings account overall offering a generous interest rate and tons of free features to help you save. And speaking of free, this account really is. There are no monthly maintenance fees, overdraft fees, or transfer fees to deplete your earnings.

This high-yield savings account supports you to save by giving you the option to create buckets for different goals and use boosters to save faster. The boosters are:

  • Recurring Transfers – schedules automatic transfers from a linked account
  • Round Ups – rounds up your Ally debit card purchases to the nearest dollar and sends the extra to your savings
  • Surprise Savings – points out money in your checking account that isn’t being used for anything and moves it to your savings

This account is easy to open. There are no minimum balance requirements to earn interest and you can fund it with as little as $0.01. While Ally technically uses balance tiers (<$5,000, $5000 – $24,999.99, and >$25,000), all positive balances currently earn the same rate.

For help with any issues you might have, Ally offers 24/7 live customer support via chat or phone.

Learn more about the Ally Online Savings Account or read our full review.

Best for beginners: Discover Online Savings Account

Discover Bank logoPros

  • No fees
  • No minimums
  • Instant transfers between Discover accounts

Cons

  • Very few branch locations
  • No advanced savings features like buckets or round-ups

Features

  • Minimum balance: $0
  • Minimum deposit: $0
  • APY: 4.00%
  • Monthly fee: $0

The Discover Online Savings Account gets pretty much everything right, from the competitive interest rate to the lack of account fees. We love this high-yield savings account for beginners because it’s easy to use and doesn’t have minimums.

There is no minimum deposit to open or minimum balance required to earn interest or avoid having your account shut down, making this the perfect option for you even if you only have a few bucks to put away right now. You can even open an account with nothing and come back later to fund it.

Although this is a pretty basic account with few bells and whistles, there’s no monthly maintenance fee to worry about and you’ll earn interest on any balance. Plus, the Discover mobile app is notoriously solid, and ditto for customer service.

Interest is compounded daily and credited monthly into your account. If you have a Discover checking account and debit card, you can easily transfer money between this and your savings account. You can also schedule automatic recurring transfers to put your saving on autopilot.

Discover does have some branch locations, but they’re really limited, so you might not have the option to manage your account in person. This account also lacks features to help organize and simplify your saving such as buckets and round-ups.

Learn more about the Discover Online Savings Account or read our full review.

Best for long-term saving: CIT Savings Connect Account

CIT Bank logoPros

  • No fees
  • No minimum balance

Cons

  • Minimum deposit required
  • No branch locations

Features

  • Minimum balance: $0
  • Minimum deposit: $100
  • APY: 4.50%
  • Monthly fee: $0

For high-interest saving, the CIT Savings Connect Account is an excellent choice. This is a newer account with a really competitive APY of 4.50%. There are no minimum balance requirements to earn this rate and you only need to deposit $100 to open. Plus, there are no monthly fees. See details here.

CIT Bank also reimburses up to $30 in third-party ATM fees per statement period and supports free mobile check deposits and external transfers.

The CIT Savings Connect account currently pays the same interest rate on all balance tiers, so you don’t have to worry about maintaining a certain balance or making regular deposits to avoid fees and earn more (although automating your saving is never a bad idea).

This basic account would be a good fit for most people, especially those looking for a fee-free option with no balance requirements. It has one of the best rates and is one of the most straightforward to open and use, so it could make a great primary or secondary savings bucket. Choose the CIT Savings Connect account if getting the best interest rate is your top priority.

CIT Bank offers a number of other savings products including stand-out money market accounts and CDs, so keep this bank in mind if you have a few different savings goals and want to make sure you’re getting the highest rates.

Learn more about the CIT Savings Connect account.

CIT Bank. Member FDIC.

CIT Savings Builder Account

And if you’re looking for another option from this online bank, you can do worse than the CIT Savings Builder Account. This high-yield savings account offers an interest rate of up to 1.00% with a low minimum initial deposit requirement of $100. There is no minimum balance required to keep your account, but your balance will determine your interest rate. See details here.

The CIT Savings Builder Account uses a tiered rate structure with a loophole. The balance tiers and interest rates are:

  • <$25,000 – 0.40% APY
  • <$25,000 – 1.00% APY if you make a monthly deposit of $100 or more
  • >$25,000 – 1.00% APY

If you can’t afford to put away more than $25,000, no worries. Just schedule an automatic transfer of at least $100 from a linked bank account to get yourself into the higher tier. This can also help you make saving a priority.

Because of the tiered interest rate structure, this high-yield savings account is ideal for people who plan to keep high balances and/or make regular contributions to their savings.

Learn more about the CIT Savings Builder Account or read our full review.

CIT Bank. Member FDIC.

Great alternatives

These accounts didn’t make our top three, but they still have a lot to offer, especially if you’re looking for an online savings account.

Axos Bank High-Yield Savings Account

Axos Bank logoFeatures

  • Minimum balance: $0
  • Minimum deposit: $250
  • APY: Up to 0.61%
  • Monthly fees: None

An Axos Bank High-Yield Savings Account is the right high-yield savings account for anyone looking to keep a low balance. There is a minimum deposit requirement of $250 to open an account, but any amount you save will earn interest. Axos uses a tiered rate structure but actually pays the highest rates on the lowest balances. You’ll earn 0.61% as long as your account stays below $24,999.99.

Each account comes with a free ATM card upon request for easy withdrawals. Plus, you can earn a referral bonus of $20 for every friend who opens an Essential Checking account using your unique link.

Open an Axos savings account or read our full review.

High-Yield Chime® Savings Account

Chime logoFeatures

  • Minimum balance: $0
  • Minimum deposit: $0
  • APY: 2.00%7
  • Monthly fees: None2

The High-Yield Chime Savings Account is a great online savings account that does your saving for you. With the Round Up Transfer and Save When I Get Paid features, you can completely forget about your saving and still make progress toward your goals. Round Ups will send the spare change from your purchases right to your savings^ and Save When I Get Paid lets you transfer up to 10% of each direct deposit of $500 or more to your savings account 1. A Chime Checking Account is required to be eligible for a Savings Account. 

This account charges no maintenance fees and has no minimum deposit or balance requirements. Check out Chime checking if you like the idea of saving and banking in one place with a platform that’s easy to use*.

Read our full review.

* Chime is a financial technology company, not a bank. Banking services provided by The Bancorp Bank, N.A. or Stride Bank, N.A., Members FDIC.
^ Round Ups automatically round up debit card purchases to the nearest dollar and transfer the round up from your Chime Checking Account to your savings account.
1 Save When I Get Paid automatically transfers 10% of your direct deposits of $500 or more from your Checking Account into your savings account.
2 There’s no fee for the Chime Savings Account. Cash withdrawal and Third-party fees may apply to Chime Checking Accounts. You must have a Chime Checking Account to open a Chime Savings Account.
7 The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The disclosed APY is effective as of November 17, 2022. No minimum balance required. Must have $0.01 in savings to earn interest.

Capital One 360 Performance Savings Account

Capital One logoFeatures

  • Minimum balance: $0
  • Minimum deposit: $0
  • APY: 3.00%
  • Monthly fees: None

Opening a Capital One 360 Performance Savings account might be the way to go if you’re looking to automate your saving with a familiar consumer bank. This account pays the same interest rate of 3.00% on all balances and doesn’t cost anything to open. To stay on track with your saving, you can schedule recurring transfers from a Capital One or external account.

If you already have an account with Capital One, you’ll be able to make quick transfers from the app. Finally, there are Capital One branches and ATMs all over the country if you like the option of banking in person.

Open a Capital One savings account or read our full review.

Marcus Online Savings Account

Marcus by Goldman Sachs logoFeatures

  • Minimum balance: $0
  • Minimum deposit: $0
  • APY: 2.50%
  • Monthly fees: None

Marcus by Goldman Sachs is an online-only bank owned by investment company Goldman Sachs. A Marcus Online Savings Account is ideal for people who want control over their savings and like to strategize different ways to grow their money. This account offers a variety of tools and extensive research to help you make informed decisions with your savings and track your progress. You can even see exactly how much interest you’ve earned from the app.

You’ll earn 2.50% regardless of your balance and there’s no minimum deposit.

Open a Marcus savings account or read our full review.

What is a high-yield savings account?

A high-yield savings account offers a higher yield than traditional savings accounts. How much higher completely depends on the market and the institution, but may be as much as ten or fifteen times the average. You might also hear the term high-interest savings account used — this is the same thing.

Right now, the national average interest rate on a savings account is 0.37%, according to the Federal Deposit Insurance Corporation or FDIC. The FDIC determines rate caps each month using the average interest rates for savings accounts, checking accounts, money market accounts, and certificates of deposit across all banks and credit unions.

How savings account interest works

There are two different ways interest can work with high-yield accounts. The first is to earn a variable interest rate and the second is to earn a tiered interest rate.

A high-yield savings account with a variable rate will pay the same interest rate on any balance. A savings account that uses a tiered interest structure will determine your rate based on your average balance and pay you according to which balance tier you fall into.

With a tiered interest rate, you often earn more interest the higher your balance is. This is to incentivize people to keep more money in their accounts. With a variable interest rate, it doesn’t matter what your balance is as long as you meet the minimum balance requirements (if there are any).

To make things a little more confusing, sometimes a bank or credit union will use a tiered interest rate structure but make the interest rate the same for every balance tier. All interest rates for online savings accounts are subject to change at any time.

Before you apply for an account, find out what rate you’ll qualify for with your balance and activity. Don’t get tricked into opening a high-yield savings account for the great interest rate unless you know you’ll actually earn that rate.

For example, a bank may advertise a high-yield savings account with an interest rate of 3.00% APY, but this rate only applies to balances over $15,000. The difference between the highest and lowest interest rates can be significant, so make sure you don’t get stuck with a lousy rate.

Read more: How to get the best savings account interest rate

What is the annual percentage yield (APY)?

Annual percentage yield is the rate of return you will earn calculated as a percentage of your savings account balance. You’ve probably noticed that the APY on an account is very slightly different from the interest rate. This is because the interest rate only shows simple interest.

The annual percentage yield or APY shows how much interest you can earn each year if you don’t take any of your money out. We like to look at the annual percentage yield rather than just the interest rate because it factors in compounding interest.

To estimate how much you can earn on a high-interest savings account, multiply the APY by your balance to see how much your account will grow if you don’t touch it.

When is interest calculated?

Interest may be calculated daily, weekly, or monthly for a savings account. This is how often your balance is used to determine how much interest you’ve earned.

This frequency can affect your earnings, and daily calculation is the best-case scenario. This is because the more frequently interest is calculated, the higher your balance will be each time it happens thanks to the interest you’ve already been paid. Interest you earn on interest is referred to as compound interest.

For example, a $1,000 balance earning a 1% interest rate pays you $10 in simple interest over a year. If interest is calculated daily, that $10 becomes $10.05 a year.

Read more: Savings interest calculator

Is interest taxed?

Yes, the interest you earn from your savings account will be taxed alongside your income, no matter how much money you bring in.

How to open a high-yield savings account

The basic process for opening a savings account is pretty much the same anywhere you go.

First, you’re going to provide some personal details including your basic contact information. Once your account has been approved, you’ll choose a funding option. Your options might be:

  • ACH transfer
  • Wire transfer
  • Direct deposit
  • Check deposit (paper or mobile)
  • Cash deposit

You need to meet minimum opening deposit requirements for your account when funding. Some banks will let you open a savings account without making a deposit right away. Just make sure you know the rules for your chosen account.

If you already have an account with the bank or credit union you’ve chosen, you can link this with your new savings account either before or after funding. This will allow for easy transfers in the future.

How to use a high-yield savings account

There’s a difference between just having a high-yield savings account and using it for all its worth. Here are some ways to make the most of high-interest savings.

Emergency fund

A high-yield savings account is the perfect place to keep your emergency fund. We recommend you have one savings account where you keep at least six months of your monthly living expenses, completely separate from the rest of your cash. You can take the money out if you get sick, lose your income, or face a large unexpected expense, and your balance will grow until then.

Short-term saving

A high-interest savings account is also a great place to save for short-term goals when you don’t want to put your money on the line with higher-risk investments. These accounts are safe and liquid, so your money is there when you’re ready for it and earning interest when you’re not.

For example, if you’re saving money to buy a new car or for your wedding in the next couple of years, you may be able to get a higher rate of return by investing in a mutual fund or other securities. But in such a short period of time, you may lose money. Investments are best for savings goals more than a few years away. For shorter-term goals, savings accounts are safer.

No matter what you’re saving for, a good rule of thumb is to save as often as possible and think about it as little as possible. If you rely on yourself to remember or feel like putting away money to save, you might have more trouble meeting your goals and start feeling frustrated when you don’t see your balance go up. Instead, take advantage of features that do the work for you. To save automatically, you can:

  • Set recurring transfers
  • Split your paycheck
  • Use booster features like roundups

Read more: The best place for short-term savings

What is the withdrawal limit for savings accounts?

Most savings accounts limit the number of withdrawals you’re allowed to make. This started with Federal Regulation D.

Federal Regulation D was a rule that limited the number of withdrawals or transfers that could be made from a savings account to six per month. This included withdrawals made in person, by phone, online, or through any other type of electronic transfer. If you made more than six transfers or withdrawals in a month, your bank might have charged you an excessive withdrawal fee or closed your account. 

In April 2020, Regulation D was suspended, but many banks still choose to restrict transactions and enforce the same penalties.

What to look for in a high-yield savings account

There are certain standout features that can immediately make or break a high-yield savings account.

Here are the main things to pay attention to when shopping for a savings account.

Minimum balance requirements

How much do you realistically plan to save? This is the first question you should ask yourself before signing up for an account. Many savings accounts have minimum balance requirements, and you won’t be doing yourself any favors if you open an account and can’t meet these.

If your account does have balance requirements, you must meet them in order to:

  1. Avoid monthly maintenance fees
  2. Earn interest
  3. Keep your account

Your balance at the end of each day is used to determine if you’re meeting requirements. If you’re not, you might be penalized.

Not all high-yield savings accounts have minimum balance requirements. Especially for online savings accounts, it’s becoming more common to not have any.

Read more: How much money should you save each month?

Minimum deposit requirements

Some banks may require you to make a certain minimum deposit when signing up for your account. Failure to do so may disqualify you from opening an account or result in a fee.

A minimum deposit requirement could be anywhere from $5 to $500. Sometimes minimum deposit and minimum balance requirements are the same, and sometimes not. It’s not uncommon for a bank to have a minimum deposit requirement but no minimum balance requirement or vice versa.

Many high-yield online savings accounts have very low or no minimum deposit requirements.

Interest and APY

You’re naturally going to gravitate toward accounts with the highest interest rates, right? That’s free money that you don’t have to work for. But be sure to pay attention to the requirements to earn interest too, not just the annual percentage yield.

For example, if a bank requires you to maintain a balance you can’t maintain to earn interest, it’s probably not the right bank for you. For your first savings account, you might prefer a variable interest rate over a tiered interest rate so you don’t have to worry about if your balance is high enough to earn interest.

Some banks also reserve their best interest rates for preferred customers. This might mean you need to have another account such as a checking account or loan to qualify for the highest APY, and that might be more trouble than it’s worth.

Monthly fees

Some banks still charge monthly maintenance fees on savings accounts, but many don’t. When your goal is to earn money on your savings, monthly fees you get charged just for having an account can really get in the way.

While you should generally look for accounts that don’t charge fees, you might make an exception if a bank offers a waiver. For example, the fee may be waived if you maintain a certain minimum balance in your account for each statement cycle or make a recurring transfer from another account.

If you feel like you can easily meet the requirements to waive a fee and an account is otherwise a perfect fit, go for it.

Cash access

Most people try to ignore the money in their high-yield savings account when they can to take advantage of compound interest.

But life happens, and sometimes you need to dip into your savings. When that happens, you should have convenient access to your money. You might be able to make a withdrawal via:

  • ACH transfer
  • Cash withdrawal
  • ATM withdrawal

Most savings accounts give you the option to make a transfer from your savings to a linked checking account. This checking account can either be with the same bank or another one entirely. If with the same bank, transfers may be instant.

Some banks also offer ATM cards with high-yield savings accounts, though you may incur a fee for ATM transactions. You can also make cash withdrawals at branch locations.

Any transfers or withdrawals you make will count toward your monthly transaction limit.

Mobile apps

Almost every bank out there offers a mobile app today, but some are far better than others. As you’re researching the features of an account, always look into the app too.

Saving from your phone only works when an app does what it’s supposed to, so functionality and convenience are important. You should be able to easily access your savings account, initiate transfers, and see your balance at any time. Those are the basics. You might also want an app that will let you make mobile check deposits, create savings goals, and chat with customer support when there’s an issue.

As a rule, online banks and larger institutions tend to have the best mobile apps. But while you might be looking for an app that’s simple and straightforward to use, someone else might prefer a robust app with educational resources, features, and a variety of notifications. Check out some customer reviews to see what real users have to say about their experiences.

Sign-up bonus

Many banks and credit unions offer sign-up bonuses when you open a high-yield savings account. These offers change all the time and can be quite enticing. For example, bonuses up to $200 are not uncommon. But while sign-up bonuses are nice, they’re not more important than interest rates, fees, and minimums.

Also, be aware that sign-up bonuses come with restrictions. Typically, you’ll need to maintain a certain minimum balance for a set amount of time to qualify. This may be six months or even longer. If your account balance drops below the minimum requirement at any time during the first six months, you may forfeit the bonus. Many bonuses also come with direct deposit requirements.

If you do qualify, you probably won’t get the bonus right away and may have to wait several weeks. All this to say that sign-up bonuses aren’t a good option for getting quick cash. Consider these after all of the other features we’ve outlined.

Are high-yield savings accounts safe?

Your money can’t get a lot safer than it is when it’s in a savings account.

Almost all savings accounts with banks are protected by the Federal Deposit Insurance Corporation (FDIC) and insured for up to $250,000 per depositor. This insurance coverage protects your money in the event that your bank loses money and is unable to repay its deposits. Almost all savings accounts with credit unions are protected by the National Credit Union Administration (NCUA) for up to $250,000 per depositor. This provides the same protections.

If a bank or credit union is not FDIC- or NCUA-insured, you may qualify for private deposit insurance.

Benefits of online savings accounts

High-yield savings accounts and online savings accounts are often one and the same. Here are some of the top benefits you can expect from an online savings account.

Higher interest

A traditional savings account with your bank or credit union might seem like the best choice, but you can do a lot better. Compared to traditional accounts, online savings accounts tend to offer much better interest rates, plus benefits like fewer fees, extra savings features, and the convenience of opening and managing your account completely online (or from your phone).

Online savings accounts can pay higher interest rates because digital accounts are cheaper to operate, lowering a bank’s costs and passing on the savings to you in the form of better interest.

Fewer fees

Online savings accounts almost always have lower fees than traditional savings accounts for the same reasons they can offer better rates. Many charge no monthly fees at all.

Avoiding monthly fees like maintenance fees, low balance fees, and inactivity fees can save you serious money in the long run. Plus, let you actually keep the interest you’ve earned.

Convenience

Online savings accounts are much more convenient to open and use. You can open your account online and fund it by just transferring the money from another account. Usually, all of this takes less than five minutes.

An online account lets you make deposits, transfer money, pay bills, and see your account activity at any time without the need for a phone call or visit to the bank. You can even view your account statements and track your progress. If you’re not a fan of brick-and-mortar branches, an online savings account either with a fully-digital bank or a hybrid bank could be perfect for you.

Perks and benefits

Online savings accounts tend to come with a lot of great, free features. Automatic transfers into your savings account from your checking account, mobile check deposit, and account alerts are just a few common ones.

Some online savings accounts go above and beyond this. They might offer savings support like boosters and automated tools, help you create a saving strategy with resources and insights, or the option to organize your savings into separate buckets or categories.

Read more: Best online savings accounts

Disadvantages of savings accounts

Although a great tool for saving for your future and protecting your finances, savings accounts in general do have limitations. Let’s talk about some of those here.

Limited withdrawals

One of the main disadvantages of high-yield savings accounts is limited cash access. A lot of this has to do with withdrawal restrictions.

Remember, you’re often restricted to just six transactions per statement period with a savings account. This is a limit that was originally set by the federal government that many accounts still stick to. You shouldn’t use your savings account as a secondary spending account because when you hit that limit, you risk losing the account. This is why savings accounts should be for money you don’t immediately need.

If you’re looking for a place to set aside some extra money you do plan to dip into regularly, consider a high-yield checking account instead of a savings account. While the rates for high-yield checking accounts aren’t usually as good as the rates for high-yield savings accounts, you’ll have more flexibility to spend your money.

Read more: Best high-yield checking accounts compared

Rates can change at any time

Another downside to savings accounts is that the interest rates are always variable. This means the rate you earn on your balance can change at any time, and it definitely will as the market fluctuates. It’s important to remember that you’re not locked into the annual percentage yield you sign up for when you open a high-yield savings account.

And if the rate does change, your bank doesn’t have to give you any sort of warning. Although competitive high-yield savings accounts will, for the most part, stay competitive and continue offering the highest yields compared to other accounts, there’s no telling how much you’ll earn in dividends a year from now.

You should choose a high interest rate but know that it can change and don’t rely on the dividends for income.

Security risks

With any type of financial account, there are going to be certain safety concerns. While these are really minimal with an insured savings account, you can take steps to maximize your personal security.

If an account offers multi-factor authentication, set it up (it’s free anyway). If you have the option to enroll in fraud protection, do it. Set up account alerts to notify you about suspicious activity and check your balance often to make sure everything looks good.

FDIC and NCUA protection will keep you safe from losing all of your money if your bank goes bankrupt, but it’s your responsibility to make sure your account is as safe as it can be from hackers.

Read more: How to make online banking more secure

Are high-yield savings accounts worth it?

The answer to this question is probably, but it really depends on what kind of account you choose. We’ll say it again, we always prefer an online savings account with no minimums and no fees. Even if you can’t yet afford to set much money aside, you can start earning a small amount of interest on your balance and setting those good savings habits with free accounts.

But if you open a savings account that charges monthly maintenance fees, overdraft fees, low balance fees, etc., you’re going to have to work harder to make the account worth it. Keep in mind that all of these fees can eat into and even exceed your interest earnings, causing you to lose money in the long run.

So basically, as long as you don’t make the mistake of choosing the wrong account and letting it drain your earnings, you have nothing to lose.

High-yield savings accounts vs. money market accounts (MMAs)

Which is the better option for your money right now: a high-yield savings account or a money market account?

A money market account or MMA is a special type of savings account. They typically have higher balance requirements to earn interest but may offer better interest rates than high-yield savings accounts. Usually, MMAs pay tiered variable interest rates so the more you save, the more you earn.

MMAs often come with higher fees, higher deposit requirements, and higher balance requirements than savings accounts. While they can earn more depending on the interest rate environment, right now the best rates are really comparable between high-yield savings accounts and MMAs.

Savings accounts and money market accounts have the same transaction limit of six per statement period.

Read more: 9 best money market accounts

High-yield savings accounts vs. certificates of deposit (CDs)

A certificate of deposit or CD is a type of deposit account that usually offers a fixed interest rate for a fixed term. This means that the amount of money you earn on your deposits is guaranteed for the length of the CD term.

CD terms can range from as little as one month to as much as 10 or even 20 years. During the term of the CD, you agree not to withdraw any of the money you’ve deposited. If you do need to access your money before the end of the term, you’ll pay an early withdrawal penalty fee.

Early withdrawal fees are equal to the interest you earn for a set number of days or months. For example, you may pay three months’ interest for taking money out of a one-year CD early.

Because of early withdrawal fees, you risk losing your interest in a CD, so you should only deposit money you’re absolutely certain you won’t need until the term is up.

Stick with a savings account until you have an emergency fund built up before you consider a CD. CDs can be better vehicles for long-term saving but they should not replace your emergency savings account.

Read more: Best CD rates of 2023

Source: moneyunder30.com

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Apache is functioning normally

June 7, 2023 by Brett Tams

In the world of personal finance, a checking account has often been viewed as the cornerstone of financial management. These accounts are the hub from which we pay bills, make debit card purchases, and handle the routine transactions of our everyday lives.

Yet, with technological advancements and a diversification of financial institutions, many individuals are seeking alternatives to traditional banks and their checking accounts.

This demand for diversity is fueled by various factors, from the inconvenience of monthly fees associated with some checking accounts to the desire for better interest rates or improved money management tools.

woman using mobile app

Understanding the Basics of Checking Accounts

Checking accounts offered by traditional banks have been around for many years, providing banking services that have become integral to our daily lives. Yet, despite their popularity, it’s essential to understand their limitations and consider why an alternative might be more suitable for your needs.

These accounts often serve as the primary tool for individuals to manage their money. You can use them to direct deposit your paycheck, withdraw cash from ATMs, and transfer funds to pay your bills. However, many traditional banking services, like checking accounts, come with a host of challenges.

For instance, many bank accounts from national banks may have minimum opening deposit requirements, monthly fees, and limitations on the number of transactions you can make within a certain period.

10 Best Alternatives to Checking Accounts

1. Cash Management Accounts

Cash management accounts, an increasingly popular alternative to traditional checking accounts, are offered by financial technology companies and brokerages. They function as a hybrid of checking and savings accounts, offering the versatility of both under a single roof.

Not being banks themselves, these companies partner with FDIC insured banks, often multiple ones, to provide these services. This partnership ensures that your money is safe and insured, a critical element to consider in personal finance.

Cash management accounts offer checking-like features, including debit cards, direct deposit capabilities, and the ability to pay bills online. They also boast savings-like features, typically offering higher interest rates compared to checking accounts at traditional banks. This dual functionality makes them an attractive option for people who want to streamline their finances and get more out of their everyday banking product.

2. Money Market Accounts

Money market accounts are offered by a wide array of financial institutions and are a kind of savings account with some checking account features. They usually come with a debit card and check-writing capabilities, allowing more accessibility to your funds compared to a regular savings account.

Although they may require a higher minimum balance compared to a checking account, they generally offer interest rates that are more competitive than those on regular savings accounts. This unique blend of features makes them a versatile option for those who can afford to maintain a higher balance.

Check out the most competitive money market accounts of 2023.

3. Savings Accounts

Savings accounts, offered by local banks, national banks, and online-only banks, are a secure alternative to checking accounts. Though they have been around for a long time, their importance in financial planning and wealth accumulation cannot be overstated.

While savings accounts do not typically offer as many transaction options as checking accounts, they often provide higher interest rates, helping your money grow over time. Some online banks offer high-yield savings accounts that offer even higher interest rates, much higher than the national average. The primary purpose of a savings account is to help you save money while earning a modest amount of interest.

Discover the best high-yield savings accounts of 2023.

5. Online-Only and Mobile Banks

In an increasingly digital world, online-only and mobile banks offer a fully digital banking experience, making them an attractive alternative to traditional banks. Without the overhead costs associated with maintaining physical branches, many online banks offer competitive interest rates on their checking and savings accounts, often significantly higher than the national average.

These banks also shine in their online and mobile banking offerings. They typically provide comprehensive app experiences, allowing you to deposit checks, transfer money, pay bills, and manage your accounts directly from your smartphone. Despite operating exclusively online, many also offer excellent customer service through various digital channels.

Find the best online-only banks and neobanks of 2023 here.

5. Credit Unions

Credit unions provide a community-oriented alternative to traditional banks. Unlike big banks, which are profit-driven, credit unions are not-for-profit organizations owned by their members. This business model allows credit unions to often offer better interest rates on savings and checking accounts.

In addition to potentially lower costs, credit unions also offer a sense of community that big banks can’t match. The services are similar to those offered by traditional banks, including savings and checking accounts, loans, and even mobile banking in many cases. Despite having fewer branches, many credit unions are part of nationwide ATM networks, providing their members with broad access to their money.

Learn about the highest-rated credit unions that anyone can join.

6. Peer-to-Peer Payment Platforms

Peer-to-peer payment platforms are not banks but offer a unique way to manage money digitally. These platforms, provided by financial technology companies, allow you to send and receive money instantly, often for free. Some even offer “bank-like” features, such as direct deposit and debit cards.

While peer-to-peer platforms might not replace a bank account for all your financial needs, they provide a convenient way to split bills, pay friends, and manage casual financial transactions.

Below are a few examples of popular peer-to-peer payment platforms:

  • Venmo: Owned by PayPal, Venmo is one of the most widely used P2P platforms. It’s well-known for its social media-like feed where users can share (or make private) their transaction descriptions. With Venmo, users can send money to anyone with a Venmo account using just their phone number or email.
  • PayPal: As one of the oldest digital payment platforms, PayPal is a widely accepted form of payment online and offers its own P2P service. PayPal users can send and receive money from other users, and the platform offers protection for many types of purchases.
  • Cash App: Developed by Square, Cash App allows users to send and receive money. It also includes unique features like the ability to invest in stocks or bitcoin and a free debit card that provides discounts at certain retailers.
  • Zelle: Zelle differs slightly in that it’s not just an app, but a service integrated into many existing bank apps. Money sent via Zelle can often be transferred directly into the recipient’s bank account instantly or within minutes.

7. Digital Wallets and Cryptocurrencies

With the rise of blockchain technology and cryptocurrencies, digital wallets are becoming a more prominent player in the financial landscape. They offer a new way to store and manage money beyond the traditional bank account.

Digital wallets can store digital currencies, such as Bitcoin and Ethereum, and also manage traditional currencies in some cases. They enable users to make online purchases, transfer funds, and even invest in various cryptocurrencies. These wallets can be accessed through a smartphone or computer, providing high convenience for the user.

However, cryptocurrencies can be volatile and come with their own set of risks, including security threats and regulatory uncertainties. Therefore, while digital wallets and cryptocurrencies offer an exciting alternative, they should be used with caution and understanding.

8. Prepaid Debit Cards

Prepaid debit cards are another practical alternative to a traditional bank account. They work similarly to a regular debit card, but instead of drawing funds from a bank account, they use the money that has been pre-loaded onto the card.

These cards can be used for purchases anywhere debit cards are accepted, and they are often reloadable. Some even allow for direct deposits from an employer or government benefits. While they may come with various fees, they offer the advantage of not requiring a bank account and providing a way to manage money with built-in spending limits.

Take a look at the top prepaid debit cards of 2023.

9. Investment Accounts

Some brokerages and financial companies now offer banking services along with investment accounts. These firms, traditionally centered around investing, have begun to venture into the personal banking space, offering services such as debit cards, check writing, and bill pay.

While not suitable for everyone, an investment account can be a viable alternative for those comfortable with a slightly more complex financial product. Moreover, some of these accounts may offer cash management features or other benefits like interest or cashback on uninvested balances, potentially giving more value than a traditional checking account.

10. Check-Cashing Services

Check-cashing services offer another alternative to a checking account, especially for those who deal primarily in cash and have fewer banking needs. These services are often provided by financial businesses that operate outside the traditional banking system.

These providers cash checks for a fee, usually a percentage of the check’s total value. While this fee can be high compared to depositing a check into a bank account, these services offer immediate access to funds, which can be beneficial for those living paycheck to paycheck.

Some check-cashing providers also offer additional financial services, such as money orders, bill payment services, and prepaid debit cards. It’s essential to understand the fee structure associated with these services, as they can be more expensive than traditional or online banking alternatives.

Key Considerations When Choosing an Alternative to a Checking Account

When looking for alternatives to traditional banks, several factors should be considered.

Fees

One of the most significant considerations is the costs associated with the account. While many online banks offer fewer fees than traditional banks, other alternatives such as cash management accounts and peer-to-peer platforms might have different fee structures. It’s essential to understand these before committing to a new financial service.

Accessibility

Consider how easy it is to access your money. If ATM access is crucial for you, make sure to understand whether your alternative choice offers this, and if there might be associated fees.

Security

Security is a crucial factor, especially with online banking services. Ensure the financial institution is FDIC insured or has equivalent protections in place. For digital wallets and cryptocurrencies, consider how to secure your digital assets properly.

Customer Service

With many online banks operating exclusively online, you might not be able to visit a branch for help. Therefore, it’s essential to consider the level of customer service provided by these alternatives.

Additional Services and Benefits

Some banking alternatives may offer additional benefits, such as high yield savings, cash back on debit card purchases, or other rewards. Assess these benefits in light of your personal finance goals and habits.

Bottom Line

The financial landscape is continually changing, with an increasing number of alternatives to traditional banks emerging. Whether you’re looking for a new place to manage your money, pay bills, or save for the future, there’s likely an alternative that suits your needs better than a checking account.

Source: crediful.com

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Apache is functioning normally

June 6, 2023 by Brett Tams

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It’s Friday, and you’re looking forward to a relaxing weekend in town with friends. You log into your online banking portal to check your balance, but your account keeps giving you an annoying “account not found” error. 

Panic sets in and questions flood your mind. Did I do something wrong? Why was my account suddenly closed? Don’t worry. You’re not alone in your panic. Many banking customers have found themselves in similar situations, left to unravel the mysteries of why the bank closed their account. 

In the world of banking, account closures can happen for various reasons, and understanding why can save you a lot of frustration and inconvenience.

Reasons the Bank May Close Your Account

There are many reasons your bank could close your account, from irresponsible behavior to fraudulent activity. No matter the reason, your bank should inform you, so the first step is to look through your unopened mail for notifications about any of these circumstances. 

1. Insufficient Funds

If your debit card frequently gets denied, your bank might decide to part ways with you. Some banks require you to keep a minimum amount of cash in your account. If your balance consistently falls below that, the bank will close your account since you’re violating its policies. Understanding how to manage your finances effectively can help you avoid this situation altogether.

To avoid overdrawing your account:

  • Turn on alerts through your bank’s mobile app. 
  • Create a budget.
  • Keep a buffer amount in your account as a cushion for unexpected expenses. 
  • Sign up for overdraft protection. 

2. Suspicious Activity

In a time of frequent cyberthreats, banks prioritize the security of their customers’ accounts above all else. So if they detect any unusual or suspicious activity on your account, they might close it. 

This activity can come in the form of identity theft or fraudulent transactions. Banks have sophisticated systems in place to monitor account activity and identify potentially fraudulent transactions. If they notice any suspicious patterns, such as multiple large transactions in a short period or transactions in unfamiliar locations, they’ll take immediate action to protect your account and other customers.

To safeguard your account and prevent account closure due to suspicious activity:

  • Regularly check in on your account through your bank’s online portal or mobile app. 
  • Enable transaction alerts that notify you of any activity on your account, good or bad. 
  • Report suspicious transactions to your bank immediately. 

3. Violation of Terms & Conditions

Having a bank account requires adhering to the terms and conditions set forth by your bank. They’re all laid out in the ridiculously long document the bank sent you when you first signed up for the account. You likely had to check a box saying you agree to them. Violating these terms and conditions can result in account closure. 

A few common violations that can lead to this closure include:

  • Illegal activities, such as money laundering, fraudulent schemes, or financing illegal ventures. 
  • Policy violations like using a personal account for business purposes or failing to maintain a certain minimum balance. 
  • Engaging in fraudulent behavior, such as providing false information, submitting fraudulent documents, or attempting to deceive the bank. 

If you have any questions or concerns, reach out before agreeing to your bank’s terms and conditions.

4. Inactivity

Believe it or not, simply leaving your account dormant for an extended period can lead to its closure. Banks close inactive accounts as a means to streamline operations and reduce costs. 

After all, having an account with no money in it isn’t making them anything in terms of profits. Additionally, inactive accounts are more vulnerable to fraudulent activities, so banks prefer to close them to minimize risk.

To prevent your account from closing due to inactivity:

  • Use your account for at least one transaction per month, even a small one like autopaying a streaming service. 
  • Set reminders or alerts on your calendar or phone to use your account.
  • Automate your recurring payments.

5. Relationship With the Bank

Your relationship with your bank plays a significant role in the overall banking experience, for both you and your bank. In some cases, rude or aggressive behavior or treatment of bank staff influences the bank’s decision to close an account. 

Additionally, if you repeatedly fail to comply with reasonable requests, such as providing required documentation, responding to inquiries, or addressing potential issues, it could lead to an account closure.

Maintaining a respectful relationship with your bank’s staff and following the bank’s rules are crucial, so to foster a positive banking experience:

  • Communicate politely and professionally.
  • Understand and comply with your bank’s guidelines.
  • If you have any questions, concerns, or issues, reach out to the bank. 

How to Get Your Closed Bank Account Reopened

Experiencing the unexpected closure of your bank account is likely a stressful situation, especially if it was for anything other than inactivity. If you respond promptly and take the necessary steps to address the issue, you should be able to get your account up and running again fairly quickly. 

1. Contact the Bank

When you discover your bank has closed your account, don’t wait to contact them. Reach out immediately. 

Approach this conversation with a calm and polite demeanor. Clearly explain your situation, provide any relevant details, and ask for specific information regarding the closure of your account. Be prepared to provide identifying information, such as your account number and full name. 

It’s beneficial to keep a record of the conversation, noting the date, time, and the name of the representative you spoke with. 

2. Seek Alternatives

There are times when an account closure can provide you with an opportunity. If your bank closed your account because you can’t keep up with its requirements or you simply aren’t using the account anymore, maybe it’s time to find another bank. 

To find a better option for your financial needs:

  • Research different banks and credit unions. Take the time to research various banks and credit unions to find one that aligns with your financial goals and preferences. Look at factors such as fees, account features, customer service, accessibility, and the convenience of branch locations or online and mobile platforms.
  • Compare account options. Look into the different types of accounts offered by the banks you’re considering. Would a checking account work better for you? Or maybe a money market account? 
  • Evaluate customer reviews and ratings. Customer reviews are the best way to get a feel for a company. Online platforms, review websites, and personal recommendations can provide valuable insights into the banking experience you should expect.
  • Ensure you can meet minimum requirements: Pay attention to the minimum requirements each bank sets for opening and maintaining the account. Ensure you can comfortably meet these requirements, such as minimum deposit amounts or monthly balance thresholds, to avoid potential closure in the future.

3. Resolve Any Outstanding Issues

Having your bank account closed doesn’t necessarily solve the problem. You must proactively address any outstanding issues to minimize the negative impact on your financial history. 

  1. Contact the bank quickly. Reach out to your bank to discuss any outstanding fees, overdrafts, or disputes associated with your closed account. Request a detailed breakdown of any outstanding balances or charges.
  2. Negotiate a resolution. Engage in a constructive conversation with the bank representative to negotiate a resolution that is fair and reasonable on both sides. If you’re facing financial hardship, explain your situation and explore possible options for fee waivers, reduced payment plans, or debt settlement arrangements.
  3. Address overdrafts and negative balances. If your closed account had any overdrafts or negative balances, work with the bank to establish a repayment plan, or pay the balance in full. 
  4. Retrieve your remaining funds. If there were funds still in your closed account, the bank provides you with a few different options to receive those funds. That can involve issuing a check, transferring the funds to another active account, or utilizing alternative payment methods. 
  5. Monitor your credit report. After resolving any outstanding issues, monitor your credit report to ensure that the closure of your account and any related matters are accurately reflected. If you notice any inaccuracies or discrepancies, dispute them with the credit reporting agencies to maintain a clean credit history.

Final Word

Understanding why your bank may close your account is not just about unraveling the mysteries of the banking world; it’s about taking control of your financial well-being. 

While the reasons for account closures can sometimes seem arbitrary, there are steps you can take to mitigate the risk and minimize the impact. 

If you just can’t make it work with your current bank, it might be time to move on and find one that can meet your needs. Check out our list of the best checking accounts. 

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Christopher Murray is a professional personal finance and sustainability writer who enjoys writing about everything from budgeting to unique investing options like SRI and cryptocurrency. He also focuses on how sustainability is the best savings tool around. You can find his work on sites like Bankrate, Money Crashers, FinanceBuzz, Investor Junkie, and Time.

Source: moneycrashers.com

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Apache is functioning normally

June 5, 2023 by Brett Tams

Do you want a low mortgage rate and a good experience to boot while obtaining a home loan? While that basically sounds impossible, a company called “Loan Factory” might be worth looking into.

That’s the dual promise they make to prospective clients, and they appear to put their money where their mouth is.

They say their rates are on average $1,000 less than their competitors, and instead of hiding them, you can find them right on their website without logging in.

What makes them unique from big banks and lenders is the fact that they’re a mortgage broker, which gives them access to lots of different rates.

This allows them to shop and negotiate on your behalf so you don’t have to. If that sounds good, read on to learn more.

Loan Factory Fast Facts

  • Mortgage broker that offers home purchase and refinance loans
  • Founded in 2006, headquartered in San Jose, CA
  • Licensed to do business in 40 states and the District of Columbia
  • 25 physical branches located throughout the country
  • Have funded $10.1 billion in home loans since inception
  • Their CEO was the #1 loan originator in 2020 per Scotsman Guide rankings

As noted, Loan Factory is a mortgage broker, or middleman between you the homeowner (or home buyer) and a wholesale lender.

They work as a liaison to help you secure financing, whether it’s a home purchase loan or a mortgage refinance.

The company got their start back in 2006 and are headquartered in San Jose, California.

Loan Factory is helmed by CEO Thuan Nguyen, who just happened to be Scotsman Guide’s Top Originator for 2021 with a whopping $2 billion in loan volume.

Some 96% of that volume consisted of mortgage refinance loans, so that’s probably their bread and butter product.

At the moment, the company is licensed in 40 states and the District of Columbia.

Those states include Alabama, Arizona, Arkansas, California, Colorado, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Hampshire, New Jersey, New Mexico, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, and Wisconsin.

How to Apply with Loan Factory

Your first step might be visiting their website to check daily mortgage rates. Simply enter some basic info and you’ll be off to the races.

If you like what you see among the rates listed, click on “Apply Now” next to the corresponding rate to begin your loan application.

They say it takes about five minutes to complete, at which point you’ll be instructed to upload supporting documentation, such as tax returns, bank statements, and pay stubs.

Once they receive your paperwork and your loan is submitted to a partner lender, a loan officer will reach out and you’ll be eligible to lock your mortgage rate.

After locking the rate, they will send you an email confirmation that clearly details your rate and if there is any cost (discount points) or cash back associated (lender credit).

At that time, you’ll need to pay for a home appraisal, which will be conducted while an underwriter reviews your loan file.

You can log on to their website at any time to check your progress, and they automatically update your status as you go.

It’s also possible to simply create an alert and receive daily pricing updates after you view rates, or click on “Qualify Me” to run your own little mortgage pre-qualification online.

If you’re the type who prefers to work face-to-face, they’ve got about 25 branches scattered across the country. You can also call them directly to get started.

Either way, much of the loan process can be conducted paperlessly from a smartphone or computer.

Loan Programs Available at Loan Factory

  • Home purchase loans
  • Refinance loans: rate and term, cash out, streamline
  • Conforming loans backed by Fannie Mae and Freddie Mac
  • HomeReady and Home Possible (3% down programs)
  • RefiNow (low income program)
  • Jumbo home loans
  • FHA loans
  • VA loans
  • USDA loans
  • Fixed-rate mortgages: 30-yr, 25-yr, 20-yr, 15-yr, 10-yr terms
  • Adjustable-rate mortgages: 5/1, 7/1, 10/1 ARM

Loan Factory Mortgage Rates

The main draw of going with Loan Factory is pricing, namely low mortgage rates and limited fees.

As mentioned, they say they beat other lenders by $1,000 on average, which means a lower combination of rate/fee.

So if a lender offers a rate of 3.25% with $2,500 in fees, they might have the same rate with just $1,500 in fees.

They’re able to offer competitive pricing for a number of reasons, the main one being that they have 37 wholesale lender partners to shop with.

Those lenders include the likes of Rocket Mortgage, UWM, loanDepot, PennyMac, Freedom Mortgage, OnQ Financial, AmeriSave, and many more.

Additionally, Loan Factory may receive volume discounts from their partners, and they employ salary-based loan officers as opposed to commission-based ones.

Reduced overhead thanks to a reliance on technology and limited advertising means they can pass savings onto their customers.

They also apparently “cut their profit” so borrowers can obtain lower rates. This would imply taking lower commissions on the back end. In other words, they make less per loan but make up for it on volume.

From what I saw, their rates were indeed on the low end, and you can see for yourself on their website without the need to sign up or log in first.

Loan Factory Reviews

On Google, Loan Factory has perfect 5-star reviews across most if not all of their physical branches.

Simply check out a branch near you and you’ll likely see a 5-star rating. Collectively, they’ve got nearly 6,000 reviews on Google at last glance.

Over at Zillow, they’ve got a near-perfect 4.98-star rating out of a possible 5 from roughly 400 customer reviews.

A good number of those reviews indicate that both the interest rate and closing costs were lower than expected, a testament to their strong pricing.

They’ve also got a 4.9-star rating on Facebook from 150 reviews, and a 4.9 rating on LendingTree from about 60 reviews, along with a 97% recommended score.

You can also check out Yelp reviews for branches near you, which also tend to be highly rated.

Lastly, they are an accredited business with the Better Business Bureau, and currently hold an ‘A+’ rating based on complaint history, of which they’ve had just one in the past 12 months.

Somewhat amazingly, they also have a 4.99/5 rating on the BBB website, which is impressive given reviews via the BBB are typically poor.

To sum things up, Loan Factory seems to be all about low pricing and quality service, which means they could be a really good fit for an existing homeowner looking to refinance.

I’d consider them a streamlined, no-frills discount lender that is best suited for those with straightforward loan scenarios in search of the lowest price.

If you want a more boutique experience, you may want to consider alternatives.

Loan Factory Pros and Cons

The Good

  • No application fee
  • Can shop your rate with 37 different lenders at once
  • Their loan officers are salaried (not commissioned)
  • Appear to offer low mortgage rates (and you can see them online)
  • Offer a digital mortgage application and loan process
  • Also have brick and mortar branches in several cities nationwide
  • Excellent customer reviews across all ratings sites
  • A+ BBB rating, accredited business
  • Free mortgage calculator and mortgage glossary on their website
  • Some staff speak Cantonese, Filipino, Hindi, Korean, Mandarin, Spanish, and Vietnamese

The Perhaps Not

  • Aren’t licensed in all 50 states
  • Limited physical locations

Source: thetruthaboutmortgage.com

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Apache is functioning normally

June 5, 2023 by Brett Tams

Lindsay Mack earned her bachelor’s degree from Georgetown University in 2005. Nearly 15 years later, when she considered the best way to grow her business acumen, an MBA was not it.

Mack, who is from Philadelphia, grew her career without an MBA. When ready to advance her skills in platform strategy, she opted for a faster, lower-cost cohort program instead.

For students like Mack, the cost of a top MBA — averaging $225,605 in the U.S., according to a 2022 report by BusinessBecause, an online publisher of graduate business content — is daunting, and the value is questionable.

“I didn’t see how making such a significant investment (in an MBA) would really leapfrog me to the next level,” says Mack, now Comcast’s executive director of product management.

Cost isn’t the only barrier to attaining a graduate business degree. BusinessBecause reports that the average acceptance rate for the most competitive U.S. business schools is 16%, based on its analysis of data from U.S. News & World Report and other sources.

If you want access to business school education without the price of tuition or hassle of admissions, you have other options.

If you prioritize credentials

Consider a graduate business certification. A certification — offered by accredited colleges and universities — differs from an MBA degree primarily in how long it takes to complete the program.

For example, a graduate business certificate from the University of Nebraska–Lincoln College of Business requires 12 credit hours to graduate. An MBA from the same university needs 48 credit hours for completion.

Because you’re taking fewer credits compared to an MBA, you can expect to pay much less. For example — based on the 2022-23 academic year — tuition for a graduate certificate in strategic management from Harvard Extension School, a Harvard Division of Continuing Education, is $15,500. A Harvard MBA costs $73,440 in tuition, not including fees.

Certificate programs are often more specialized than graduate business degrees. This can be great for those looking to develop a specific skill set — like business analytics — to advance in their career, says Olivia Jobson, associate director of graduate recruitment at Oregon State University College of Business.

If you need a more flexible schedule

Consider a self-guided online course. Companies like MasterClass, Skillshare, Udemy and Coursera let you learn business skills at your own pace.

“Our central tenet is to meet learners where they are,” says Marni Baker Stein, Park City, Utah-based chief content officer at Coursera. The company offers individual courses, professional and credentialed certifications, and full degrees through university partnerships.

Many online companies allow you to access some courses for free, but the full libraries require a monthly subscription. MasterClass, for example, offers unlimited access to existing and new content for $180 annually.

Unless partnering with an accredited institution, these programs typically do not offer credits for completion. If you need credits to transfer to a university, consider enrolling in an accredited program.

If you want more of the MBA experience

Consider a business training cohort. Though it’s hard to replicate the two-year, in-person MBA experience, some companies creatively found ways to incorporate its key components into online learning.

Section, a New York City-based online business education company, for example, offers one- to two-week online sprints structured much like sections within an MBA program. Members participate in live classes online, group discussions and even team projects for $996 per year.

Similarly, the Invited MBA, by Texas-based corporate leadership development company Abilitie, offers a 12-week program that includes live virtual sessions, team business competitions, study groups and even online happy hours. Tuition is $1,850.

Companies like Section and Abilitie are not accredited universities. Graduating from these programs will not result in an MBA degree, but some graduates of the programs say it delivered exactly what they needed — practical business skills, a strong network and greater employability at a fraction of the cost of an MBA.

“I have folks who are at the exact same level as I am, who did full-time MBAs and have school debt, and I am now peers with them,” says Nicholas Schroeder, a Seattle-based graduate of Abilitie’s Invited MBA.

Upon completing the Invited MBA in May 2021, Schroeder, a former U.S. Army officer, transitioned into a career in consulting — the most coveted industry for prospective graduate management students, according to a 2022 survey by the Graduate Management Admission Council, an association of graduate business schools.

This article was written by NerdWallet and was originally published by The Associated Press.

Source: nerdwallet.com

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Apache is functioning normally

June 5, 2023 by Brett Tams

IPO stocks are shares of companies that have recently, or are about to, go public. When a company IPOs, its stock becomes available to most investors for the first time, which can create a frenzied feel in the market.

Deciding whether to buy IPOs is a bit more complicated. IPOs require investors to research a company’s financial history and understand how they might grow their business in the future. There’s a lot to consider, and it’s important to do some homework before investing in IPO stocks.

Private vs Public Companies

An initial public offering, or IPO, is the first time that shares of a company are offered for sale to the public. Once an IPO occurs, company stock is listed on a stock exchange and is available for pretty much anyone to buy.

Before the IPO, the company is considered to be private. Private companies may still have shareholders, but it’s often a relatively small circle that may include founders, early employees, or even private investors such as venture capitalists.

Outsiders can invest in a company while it’s private, but doing so can be more cumbersome and involve bigger checks or investment vehicles like private equity or mutual funds. For the most part, companies that choose to remain private are small or medium-sized companies, though there are some large companies that have remained in private hands.

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Why Do Companies IPO?

Two benefits that private companies enjoy is getting to choose who invests in them and not having to report financial results to a large pool of investors. Once a company goes public, it falls under the regulations of the Securities and Exchange Commission (SEC), which requires quarterly earnings reports.

However, companies may hit a ceiling when it comes to how much private capital they can raise, and an IPO can give them access to large sums that can help them continue growing.

If demand increases for shares, companies can issue more shares in a secondary offering. These can occur when a large stakeholder in the company sells their shares, which doesn’t dilute the existing pool of stocks available on the market. Or a company can create all new shares, which raises the overall number available and can result in a drop in share price.

IPOs also often occur with much fanfare, which can help generate publicity for the business. Companies whose stocks are listed on the New York Stock Exchange or Nasdaq may celebrate in a ceremonial bell ringing that signals the opening of stock trading on the day of their IPO, generating press coverage.

IPO Price vs Opening Price

The IPO price is the price at which shares of a company are set before they are sold on a stock exchange. As soon as markets open and the stock is actively traded, that price begins to go up or down depending on consumer demand. This is the opening price, and it can change quickly.

Not everyone has the ability to buy shares at the IPO price. When a company wants to go public, they typically hire an underwriter — an investment bank — that structures the IPO and drums up interest among investors. The underwriter acquires shares of the company and sets a price for them based on how much money the company wants to raise and how much demand they think there is for the stock.

The underwriter will likely offer IPO shares to its institutional clients, and it may reserve some for other people close to the company. The company wants these initial shareholders to remain invested for the long-term and tries to avoid allocating to those who may want to sell right after a first-day pop in the share price.

That’s why most regular investors don’t have access to shares at the IPO price unless they have an in with the company or its underwriter. This is especially true for the largest, most high profile IPOs.

Investment banks go through this relatively complicated process in part to help them avoid some of the risks associated with a company going public for the first time. The bank will try to make sure that the IPO is oversubscribed, when there are more buyers lined up for the stock at the IPO price than there are actual shares. The bank is trying to drive up demand, and subsequently the offering price of the stock.

Alternative IPO Routes

Companies don’t necessarily have to take this route to have an IPO. In recent years, alternatives to the traditional IPO have become more popular.

For example, when Spotify went public in 2018, it skipped the underwriting process, instead going through a “direct listing” – when it offered shares at the same time that it listed them on the stock exchange. The company was able to do this in part because it didn’t need to raise a lot of capital and people already understood what Spotify does. In other words, they didn’t need an investment bank to explain how the company works to investors in order to get them on board with buying shares.

Another way companies have been going public is via SPACs, or special purpose acquisition companies. SPACs are shell companies that raise money through an IPO, then use those proceeds to find a private business to buy. The SPAC then merges with the private business, taking the company public through the process.

SPACs tend to offer a speedier route to going public. They’ve also become more popular since determining the private company valuation is often done through negotiations that are conducted behind closed doors–a process that’s less vulnerable to volatility in the market.

Recommended: How Do SPACs Work?

How to Buy IPO Stock

Steps to Investing in an IPO

1. Read the Prospectus

IPOs can be hard to analyze: It’s difficult to learn much about a company going public for the first time. There’s not a lot of information floating around beforehand since when companies are private, they don’t really have to disclose any earnings with the SEC. Before an IPO, you can look at two documents to get information about the company: Form S-1 and the red herring prospectus.

2. Find Brokerage

If you want to purchase shares of a stock in an IPO, you’ll most commonly have to go through a broker. Some firms also let you buy shares at the offering price as opposed to the trading price once the stock is on the public market.

3. Request Shares

Once a brokerage account is set up, you can let your broker know electronically or over the phone how many shares of what stock you’d like to buy and what order type. The broker will execute the trade for you, usually for a fee, although many online brokerages now offer zero commission trading.

IPO investing at your fingertips.

Don’t miss your chance – get in at the IPO price.

Is It a Good Idea to Buy IPO Stocks?

There can be a lot of buzz and anticipation surrounding an IPO. And that makes sense — remember, it’s the job of the underwriters to get people excited for the company’s debut. You may be tempted to jump in and buy shares immediately, but there are some things to consider.

IPOs tend to be by new companies that haven’t been around for a while. That increases the likelihood that they’re not yet profitable yet, and consequently, the valuation set by the IPO share price may be too high.

Recommended: Guide to Tech IPOs

Direct stock purchase plans (DSPPs) offer another way for individual investors to buy company stock without a broker. Shares purchased in this way may have lower fees and might even be cheaper to buy. A DSPP can also be a handy way for new investors to buy stocks for the first time as DSPPs offer low minimum deposits.

The SEC regulates DSPPs in the same way that it regulates stocks bought through a stock brokerage, so the risks to investors are the same no matter how they purchase the stock. DSPPs may be reserved for a special group of people who are close to the company.

Lock-up Periods 101

Shortly after a company’s IPO there may be a period in which its stock price experiences a downturn as a result of the lock-up period ending.

The IPO lock-up period is a restriction placed upon investors who acquired company stock before it went public that keeps them from selling their shares for a certain period of time after the IPO. The lock-up period typically ranges from 90 to 180 days. It’s meant to prevent too many shares in the early days of the IPO from flooding the market and driving prices down.

However, once the period is over, it can be a bit of a free-for-all as early investors cash in on their stocks. It may be worth waiting for this period to pass before buying shares in a newly public company.

The Takeaway

Investing in IPO stocks is risky, but it can be exciting for many investors. There’s the chance that a newly-public stock could see big gains, but it could also see big losses, too. That’s why it’s important to know what you’re getting into.

Ultimately, investors don’t really know what will happen when a stock goes public. Stock prices could skyrocket, but they could also plummet. If you have your heart set on investing in IPOs, you can find out about upcoming listings by taking a look at stock exchange websites.

Ready to invest in your goals? It’s easy to get started when you open an Active Invest account with SoFi Invest. You can invest in stocks, exchange-traded funds (ETFs), and more. SoFi doesn’t charge commissions, but other fees apply (full fee disclosure here).

For a limited time, opening and funding an account gives you the opportunity to win up to $1,000 in the stock of your choice.


SoFi Invest®
The information provided is not meant to provide investment or financial advice. Also, past performance is no guarantee of future results.
Investment decisions should be based on an individual’s specific financial needs, goals, and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . SoFi Invest refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.
1) Automated Investing—The Automated Investing platform is owned by SoFi Wealth LLC, an SEC registered investment advisor (“Sofi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC, an affiliated SEC registered broker dealer and member FINRA/SIPC, (“Sofi Securities).

2) Active Investing—The Active Investing platform is owned by SoFi Securities LLC. Clearing and custody of all securities are provided by APEX Clearing Corporation.

3) Cryptocurrency is offered by SoFi Digital Assets, LLC, a FinCEN registered Money Service Business.

For additional disclosures related to the SoFi Invest platforms described above, including state licensure of Sofi Digital Assets, LLC, please visit www.sofi.com/legal.
Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform. Information related to lending products contained herein should not be construed as an offer or prequalification for any loan product offered by SoFi Bank, N.A.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Investing in an Initial Public Offering (IPO) involves substantial risk, including the risk of loss. Further, there are a variety of risk factors to consider when investing in an IPO, including but not limited to, unproven management, significant debt, and lack of operating history. For a comprehensive discussion of these risks please refer to SoFi Securities’ IPO Risk Disclosure Statement. IPOs offered through SoFi Securities are not a recommendation and investors should carefully read the offering prospectus to determine whether an offering is consistent with their investment objectives, risk tolerance, and financial situation.

New offerings generally have high demand and there are a limited number of shares available for distribution to participants. Many customers may not be allocated shares and share allocations may be significantly smaller than the shares requested in the customer’s initial offer (Indication of Interest). For SoFi’s allocation procedures please refer to IPO Allocation Procedures.
Claw Promotion: Customer must fund their Active Invest account with at least $10 within 30 days of opening the account. Probability of customer receiving $1,000 is 0.028%. See full terms and conditions.
SOIN0523120

Source: sofi.com

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Apache is functioning normally

June 4, 2023 by Brett Tams

Mongoose vs. Cobra. Coyote vs. Roadrunner. Pirate vs. Ninja?

And finally, “fixed-rate mortgage vs. adjustable-rate mortgage.”  Yes, we’re talking about the greatest rivalries of all time.

Okay, maybe this one isn’t as interesting as those others mentioned above, but it can be if you’re buying a home or refinancing an existing mortgage.

So what’s better, the boring old fixed-rate mortgage or the more provocative and often controversial adjustable-rate mortgage (ARM)?

Let’s discuss both and come up with some conclusions, which can vary based on individual preferences and circumstances.

Fixed-Rate Mortgage vs. Adjustable-Rate Mortgage

ARM_vs_fixed

During the housing boom in the early 2000s, homeowners often chose adjustable-rate mortgages as a means to qualify for a home they probably wouldn’t be able to afford with a traditional fixed mortgage.

Back then, you could qualify a borrower at the ARM’s lower start rate, even though the loan would eventually adjust much higher.

Even if they could afford a fixed-rate loan, homeowners were happy to take the lowest interest rate possible, which typically came with the ARM.

But times have changed, and adjustable-rate mortgages have now fallen out of fashion with fixed-rate mortgage rates hitting all-time record lows. Rates have since risen quite a bit but the trend is the same.

In fact, fixed-rate mortgages account for more than 90% of the purchase money mortgages and refinance loans being originated nowadays.

Sure, fixed mortgages are definitely more popular, but that doesn’t mean they’re any better, or always the right choice.

It’s just a matter of preference for most.  And as homes become less and less affordable, the popularity of ARMs will rise once more.

Fixed-Rate Mortgages Like the 30-Year Are the Default Option

fixed

  • Most homeowners opt for fixed-rate mortgages when buying a home or refinancing an existing loan
  • We’re talking 90% or more of all home loans are 30-year or 15-year fixed mortgages
  • ARMs were very popular prior to the mortgage crisis because of their relative affordability
  • But now have less than 5% market share (that could change as home prices continue to rise)

When taking out a mortgage, most people tend to choose a fixed-rate mortgage, making it the default option.

The most popular of the fixed mortgages is the 30-year fixed, seeing that the payment is fixed for the entire term of the loan, and the long amortization period keeps monthly payments low.

The 15-year fixed-rate mortgage is also pretty popular, but because the entire balance must be paid off in half the amount of time, monthly payments are much higher.

That means fewer borrowers are willing or able to choose one due to affordability concerns.

Start with a 30-Year Fixed, Refinance to a 15-Year Fixed?

Typically, a homeowner will start with a 30-year fixed, then when it comes time to refinance, they’ll go with a 15-year fixed to stay on track and avoid resetting the clock.

This allows a homeowner to save money and stay on track in terms of paying off their loan. If they take out another 30-year loan they’d delay their payoff.

There are also adjustable-rate mortgages, which most borrowers tend to avoid unless they are extremely savvy investor-types, ultra-rich, or instructed to do so by their mortgage broker or loan officer.

I say savvy because some folks will take a chance on the initial interest rate discount offered on ARMs despite the associated risk of a higher interest rate in the future.

So you need to know what you’re doing when selecting an ARM, and most importantly, have the capacity to absorb any interest rate adjustments in the future.

As mentioned, there were also those borrowers who had to take out an adjustable-rate mortgage to qualify because the interest rate was lower.

This was a routine practice before the mortgage crisis, with the ARM option typically floated by the real estate agent, broker, or loan officer whether it was in the borrower’s best interest or not.

This isn’t as common nowadays because it’s not necessarily easier to qualify for an ARM since you often need to qualify at the fully-indexed rate.

What Type of Adjustable-Rate Mortgage Are We Talking About?

most ARMs

  • Today’s ARMs are usually hybrids with a fixed and adjustable period
  • They feature a fixed interest rate at the beginning of the loan term for X number of years
  • Followed by an adjustable-rate period for the remainder of the loan term
  • This makes them a little bit safer, but not as cheap as they otherwise would be

The big question when debating the fixed vs. ARM decision is what type of adjustable-rate mortgage are we dealing with?

These days, it’s quite common to take out an ARM with an initial fixed-rate period, such as a 5/1 ARM or a 7/1 ARM.

The above examples are fixed for the first five and seven years, respectively, before becoming annually adjustable for the remainder of the term. They’re known as hybrid ARMs for that reason.

There’s even an option that is fixed for 10 years before its first adjustment, making it relatively low-risk.

This means you’ve got some breathing room before the interest rate adjusts up or down. That’s right, your mortgage interest rate can move up or down if it’s an ARM.

And all of these ARMs are amortized over a 30-year period, meaning they will take 30 years to pay off, assuming you hold them until maturity (which most borrowers don’t).

So they are the same as a fixed-rate mortgage in terms of length, and if you only keep them for five or seven years, they act no differently regarding how much principal and interest is paid.

Actually, you’d likely pay off more of your principal balance and pay less interest due to the lower interest rate on the ARM.

The major difference is that the 30-year fixed is, ahem, fixed, while the ARMs are, you guessed it, adjustable. By adjustable, I mean your mortgage rate can move up, down, or sideways.

This obviously presents some serious risk, assuming mortgage rates rocket higher during the few short years you hold the loan.

ARMs Can Go Up and Down (But Typically Only Rise)

FRM vs ARM

  • ARMs can adjust higher or lower over time depending on the associated mortgage index
  • In that sense they don’t necessarily need to be refinanced
  • Whereas if mortgage rates drop significantly after you obtain your loan
  • You may need to refinance your fixed-rate mortgage to take advantage of lower market rates

While it’s possible that mortgage rates could move lower in the future, they’re no longer at record lows and may just stay put over the next few years in the 5-6% range.

And mortgage indexes tied to ARMs have risen with all other interest rates and likely won’t fall anytime soon.

So an ARM you obtain today will probably reset higher upon its first adjustment, meaning your monthly mortgage payment will go up.

If you can’t handle that hypothetical higher mortgage payment, you may want to stick with the 30-year fixed, even if it’s slightly higher today.

But will you stay in the home for 5-7 years, or will you move. And will you refinance before that time?

If there’s a good chance you will do either, an ARM could make more sense than a fixed-rate mortgage, assuming the interest rate is a lot lower.

Also note that both fixed-rate mortgages and ARMs require active participation. Just because your loan has a fixed rate doesn’t mean you don’t have to keep an eye on rates.

If rates move lower, you may lose out if you don’t refinance your fixed-rate mortgage. So it’s not as set-it-and-forget-it as it appears.

Keep the ARM for the Fixed-Rate Period Only

If you are buying your first home, but plan to move or upgrade to a better home as you start a family, an adjustable-rate mortgage might be the best option short-term.

And the money saved during those few years can be used for a down payment on the next home. Additionally, the lower interest rate increases affordability during the months it’s held.

At the same time, it hasn’t been uncommon lately for homeowners to choose a 30-year fixed, then refinance into another 30-year fixed shortly after once rates improved.

This is mainly because the initial discount on ARMs hasn’t been great relative to fixed-rate alternatives.

If the spread between the two isn’t wide, it may not be worth the risk.

And chances are someone who elects to go with an ARM will likely suffer long-term if they keep it.

Most will probably have to refinance or sell before the first rate adjustment.

This is why short-term ARMs are typically reserved for the very wealthy, who have the option to refinance or pay off the loan whenever they choose.

If you go with an ARM and don’t have the option to pay it off or refinance, you could be stuck with a rising payment, which could put your mortgage (and property) in jeopardy.

Tip: Never choose an adjustable-rate mortgage just to qualify for a loan. If you can’t qualify for a loan at the fixed mortgage rate, consider holding off and renting for a while or buying a cheaper property.

Does the Initial Discount of an ARM Justify the Risk?

worth risk

  • Make sure the ARM discount is worth the risk of a potentially higher rate later
  • Also consider how long you’ll keep your home loan and the property
  • You might not keep it long enough to ever worry about a rate reset
  • It could be a much better deal than the more expensive fixed loan you won’t take full advantage of

Be sure you’re getting a good discount on the ARM in exchange for the uncertainty and risk of it rising in the future.

Currently, 30-year fixed mortgage rates are hovering around 6%, while the 5/1 ARM is pricing pretty similarly, depending on the lender.

The spread between products isn’t great at the moment, meaning ARMs aren’t too favorable right now.

At other times, the difference in pricing might be 1.5%, making an ARM a serious contender.

Risk appetite, age (retirement), job status, investment strategy, and downright stress will also come into play, so be sure to do plenty of math and compare different scenarios before deciding on anything!

Simply put, you’re taking a risk when choosing an ARM (hence the discount), so take a hard look at the numbers compared to fixed rate options.

While an adjustable-rate mortgage typically provides financing at a discount, it comes with much more uncertainty, especially in today’s market.

And if it’s a goal to pay off your mortgage, a fixed mortgage is generally the best option for most.

Tip: If you buy an owner-occupied property that you intend to later rent out for the long-term, a fixed-rate mortgage might be a good pick because you’ll probably keep the loan for a long period of time.

And chances are you won’t want to refinance the loan since financing is more expensive on investment properties.

When Is an Adjustable-Rate Mortgage Is a Good Idea?

  • You are buying a starter home and plan to sell in a few years
  • You expect mortgage rates to improve in the near future and will likely refinance
  • You have marginal credit and expect to improve it, thereby opening the door to better financing
  • You didn’t get great terms in general and think you can do better once those issues are resolved
  • You’re wealthy and can pay off your loan in full whenever you wish
  • There’s a large spread between ARMs and fixed interest rates

When a Fixed-Rate Mortgage Might Be the Better Call

  • Rates are super low (or at/near record lows) and aren’t expected to get any better
  • When interest rates are expected to rise substantially in the near future
  • If you have trouble refinancing and don’t want to take any chances
  • You bought a home you wish to rent out in the future and don’t want to have to refinance it as a non-owner occupied property
  • You want to pay off your home loan in full by a certain date (e.g. retirement) and want that certainty
  • If the spread between fixed and ARM rates is marginal

Pros of Fixed-Rate Mortgages

  • The interest rate will NEVER change
  • Your monthly payment won’t fluctuate
  • Easier to manage your finances/budget
  • Rates on fixed-rate mortgages are very low at the moment
  • No stress about what rates are doing (you can sleep at night)
  • No need to refinance unless rates drop dramatically (but you still can if need be)
  • Easy to wrap your head around, no surprises

Cons of Fixed-Rate Mortgages

  • Interest rates are typically more expensive
  • Your monthly payment will be higher
  • You’ll pay more interest over the loan term
  • It could be harder to qualify for a mortgage with a higher rate
  • You’ll pay your mortgage off more slowly
  • You’ll build equity at a slower rate
  • You may choose not refinance for fear of losing your low, fixed rate

Pros of Adjustable-Rate Mortgages

  • Lower mortgage rate (at least initially)
  • Lower monthly payment
  • You’ll pay less interest in the early years
  • Build equity faster while interest rate is lower
  • Most ARMs are fixed for a certain amount of time
  • Caps and ceilings limit interest rate movement
  • You might sell/move before the interest rate even adjusts
  • You can always refinance if rates rise and you qualify
  • Interest rates can actually drop over time!
  • You’ll have extra cash on hand for other expenses or investments

Cons of Adjustable-Rate Mortgages

  • Interest rates can rise substantially in a short period of time
  • You may not be able to afford the higher monthly payment post-adjustment
  • You could lose your home to foreclosure if you can’t keep up with payments
  • You may refinance over and over and never actually pay off your mortgage
  • Refinancing can be quite costly versus holding your original fixed-rate loan
  • You might be stuck with your high-rate loan if you don’t qualify for a refinance
  • ARMs often feature floors that limit if you interest rate can actually drop
  • You need to actively keep track of mortgage rates
  • You will likely be a lot more stressed
  • Your interest rate may dictate whether you move or stay put
  • More difficult to budget accurately
  • Time moves faster than you may think

(photo: eckes/bernd)

Source: thetruthaboutmortgage.com

Posted in: Mortgage Tips, Refinance, Renting Tagged: 15-year, 30-year, 30-year fixed mortgage, About, active, affordability, affordability concerns, affordable, age, agent, All, Alternatives, amortization, ARM, ARMs, balance, before, best, big, boring, borrowers, Broker, Budget, build, Buy, Buying, Buying a Home, ceilings, chance, choice, Credit, Crisis, decision, down payment, equity, estate, existing, expenses, expensive, Fall, Family, Fashion, finances, Financial Wize, FinancialWize, financing, first home, fixed, fixed rate, foreclosure, future, General, goal, good, great, hold, home, home loan, home loans, home prices, Homeowner, homeowners, homes, Housing, housing boom, in, interest, interest rate, interest rates, investment, Investment Properties, Investor, job, loan, Loan officer, Loans, low, LOWER, Make, making, manage, Marginal, market, math, money, More, Mortgage, Mortgage Broker, mortgage interest, Mortgage Matchups, mortgage payment, MORTGAGE RATE, Mortgage Rates, Mortgage Tips, Mortgages, most popular, Move, or, Original, Other, payments, plan, play, Popular, pretty, Prices, principal, PRIOR, products, property, Purchase, rate, Rates, Real Estate, real estate agent, Refinance, refinancing, Rent, renting, retirement, rich, right, rise, risk, room, routine, save, Save Money, Sell, short, sleep, stress, time, traditional, trend, upgrade, versus, will

Apache is functioning normally

June 3, 2023 by Brett Tams

Since its debut in 2013, Chime has become quite popular. This financial technology company partners with Bancorp Bank, N.A. and Stride Bank, N.A. to provide a number of FDIC-insured bank accounts. Just like most online banks, Chime offers higher annual percentage yields than brick-and-mortar banks.

Chime offers a credit builder account7, which acts like a secured credit card to help customers establish credit. However, its flagship products are the Chime® Savings Account and Chime® Checking Account8.

Chime has one of the most robust apps in the world of mobile banking. It also has a phenomenal rating in both the Apple App Store and Google Play Store.

Despite the fact that Chime comes with many benefits, it’s not right for everyone. After all, there are no physical branch locations and its customer service could be improved. Plus, you might be able to find higher APYs elsewhere.

18 Best Chime Alternatives

If you’re looking for alternatives to Chime, you’ve come to the right place. We’ve done the heavy lifting for you to create this comprehensive list of the best Chime alternatives.

1. GO2bank

GO2bank is the digital banking platform backed by Green Dot Corporation, a financial technology company known for its prepaid debit cards. GO2bank is designed to help people better manage their money through its user-friendly mobile app and competitive features.

The mobile banking app allows you to open an FDIC-insured account with no monthly maintenance fees if you have qualifying direct deposits. You also have access to a network of over 19,000 fee-free ATMs across the nation. With the ability to receive direct deposits up to four days early and a high-yield savings account that pays up to 4.50% APY on savings up to $5,000, GO2bank offers a complete banking solution.

GO2bank also provides a secured credit card that can help you build credit over time. With this card, you can establish or improve your credit score by making on-time payments and keeping your balance low. There are no annual fees, no credit checks, and no interest charges if you pay your balance in full every month.

In addition to these features, GO2bank offers various ways to deposit cash, including the option to deposit cash at participating retailers. You can also use the app to pay bills, send money to friends or family, and set up custom savings goals.

Read our full GO2bank review.

2. Current

Current is a neobank that partners with Choice Financial Group and Metropolitan Commercial Bank to offer banking services. It only offers one bank account that serves as an online checking and online savings account.

Current doesn’t charge monthly maintenance fees, monthly account fees, or overdraft fees. In addition, you can reap the benefits of automated savings pods and early direct deposit. Unlimited domestic ATM access is also free as Current is part of the Allpoint ATM network. You also get access to early direct deposits.

If you have kids, you can open a linked Teen Banking Account and help them build healthy financial habits. We can’t forget the Current Visa debit card, which lets you earn cash back on debit card purchases at more than 14,000 participating retailers.

Read our full Current review.

See also: Chime vs. Current: Which Is Better?

3. Axos Bank

Axos Bank is an online only bank that first opened in 2000. Its checking account options include the Essential checking account, Rewards checking account, and Cashback checking account. While Essential is a basic checking account with no fees or minimums, the Rewards checking account earns up to 1.00% interest if you meet certain requirements.

With the Cashback checking account, you can earn up to 1.00% cash back on qualifying debit card purchases. Rest assured there’s also a high yield savings account and money market account with a competitive APY. Like Chime, Axos also offers a highly rated mobile app.

Read our full Axos Bank review.

4. Quontic Bank

Headquartered in New York, Quontic Bank has been around since 2008. It has one brick-and-mortar branch in Astoria, New York but serves customers online in all 50 states.

Quontic’s lineup of products includes checking accounts, savings accounts, money market accounts, and certificate of deposit (CD) accounts. It also offers real estate products.

You can choose from three checking accounts: Cash Rewards Checking, High Interest Checking and Bitcoin Rewards Checking. There’s also a high-yield savings account, which pays an impressive APY.

No matter which accounts you decide on, you’ll be pleased to learn there are is no monthly service fee. Plus, you’ll benefit from an extensive ATM network and mobile app.

Check out our full review of Quontic Bank.

5. Cash App

Created by Square and based in San Francisco, Cash App is a peer-to-peer payment app. Cash App lets you send and receive money, do your banking, and open investment accounts, such as retirement accounts. The banking feature requires you to order a Cash App card and accept that FDIC coverage is not available.

Keep in mind that there is no way to build your credit or save money with Cash App. But you can use it to buy stock and Bitcoin for as little as $1. Plus, Cash App lets you prepare and file your federal and state taxes for free.

Learn more about how Cash App works.

6. Brigit

Brigit is a personal finance app that offers paycheck advances to help you out when you need fast cash. It might be a great option if you can’t wait until payday but want to avoid insufficient fund fees and overdraft fees. Brigit also allows you to keep track of your credit score and protect yourself from identity theft.

Additionally, you can use Brigit to find side gigs or borrow money with a credit builder loan. You will have to pay $9.99 per month to unlock all of these features. The good news, however, is you won’t be charged any interest or tips.

7. Dave

Launched in 2017, the Dave App can give you the chance to advance your paycheck to cover small emergencies. It also offers a spending account, which is essentially a checking account with no low balance or overdraft fees. To take advantage of the Dave app, you’ll be on the hook for a $1 monthly subscription fee as well as an optional express fee and tip.

There’s also a budget feature that tracks your income and spending so you can pay your bill. It will notify you any time you’re at risk of overdrafting. In addition, Dave can help you find a side hustle and earn extra income.

8. Revolut

When it initially launched in 2015, Revolut was a challenger bank with a travel card and cheap exchange rates. Now, it describes itself as a digital banking platform and uses Barclays and Lloyds to store your money. Just keep in mind that since it’s not a bank, it doesn’t offer any deposit protection.

Revolut’s long list of perks include surcharge-free ATMs, travel perks, and spending alerts. Plus you can earn cash back on Revolut card purchases and even open an investment account to invest in popular cryptocurrencies. If you travel abroad often and are looking for benefits you may not be able to find from most banks, Revolut should be on your radar.

Read our full Revolut review.

9. Varo

Varo is a digital bank with impressive technology as well as a lineup of checking and savings accounts with unique features like Chime. Since it prides itself on minimal fees, you won’t have to worry about monthly maintenance fees, transfer fees, or foreign transaction fees.

Furthermore, since it’s part of the Allpoint ATM network, you can enjoy free domestic ATM withdrawals at more than 55,000 ATMs. In addition to a competitive APY for its savings accounts, you can enjoy the Save Your Pay and Save Your Change features.

While Save Your Pay automatically transfers a percentage of your paycheck to your savings. Save Your Change rounds up online checking account transactions and lets you transfer money to your savings. These features are different from what you’d find with other online checking accounts.

Read our full Varo review.

10. Capital One

Capital One is one of the largest banks in the U.S. Its online checking and savings accounts come with no minimum balance fees.

Capital One’s 360 Performance Savings account offers an impressive APY on all account balances. This makes it worth considering regardless of what your savings goals entail. It lets you set savings goals and automatic savings plans so you can transfer funds from your Capital One 360 bank account.

With a Capital One bank account, you may access over 70,000 fee free ATMs. If you prefer in-person banking, you’re in luck because there are more than 300 branch locations in select states. You can also enjoy free overdraft protection and download the Capital One app to send and receive funds through Zelle.

Read our full Capital One review.

11. Discover Bank

When most people think of Discover Bank, credit cards come to mind first. But like Chime, Discover also offers checking accounts, savings accounts, money market accounts, CDs, and even personal loans.

It doesn’t impose minimum monthly balance requirements or charge any monthly fees or overdraft fees. Discover’s savings accounts and CDs are known for impressive APYs and its highly rated mobile app with a Quick View feature makes it a breeze to bank while you’re on the go.

Additionally, Discover offers more than 60,000 fee-free ATMs and you can earn 1% cash back on up to $3,000 in debit card purchases each month. If you need assistance, you can always reach out to its 24/7 U.S. customer service representatives.

12. Ally Bank

Headquartered in Utah and a division of Ally Financial, Inc. Ally is a full service online bank with an extensive product line up. Its deposit accounts, like checking accounts and savings accounts as well as CDs, come with competitive interest rates.

In addition to 24/7 customer service, Ally offers a robust mobile app you can use to check balances, transfer funds, deposit checks, pay bills, and send money via Zelle.

With Ally, there are no minimum balance requirements or fees for account maintenance, overdrafts, ACH payments, incoming wire transfers, or cashier’s checks. Aside from bank accounts, Ally also services customers with a wide range of mortgages, loans, and investing products. The main drawback is that you can’t deposit cash. Despite this, Ally is considered one of the best online banks.

Read our full Ally Bank review.

13. One Finance

One Finance is an online bank that lets you do all your banking from one bank account. With One, you can open one account that acts as a savings and interest checking account with no fees and the chances to earn a high APY. Your account will feature pockets that let you manage your money in numerous ways so you can budget and set savings goals.

You can think of a spend pocket as a checking account that doesn’t pay interest but helps you visualize the money you can spend each month. If you budget for various categories, like rent, groceries, and entertainment, it makes sense to have multiple spend pockets to keep track of your spending money. If you prefer, however, you can stick to one and have all your spending come from the same place.

14. Aspiration

Aspiration offers a Spend and Save account that offers checking and savings features. You can choose a basic account with a “pay what is fair” monthly fee, which can be $0 or an Aspiration Plus account, with a monthly fee but additional benefits like a higher APY on savings. If you pay annually, you can enjoy a lower fee.

Aspiration supports the environment through features like cash back if you spend at socially conscious businesses. You also have the chance to plant a tree every time you use your debit card. Additionally, your personal impact score tells you the environmental and social effects of your shopping habits. It also promises that your cash deposits won’t pay for the exploration or production of fossil fuels.

Read our full Aspiration review.

15. Bank5 Connect

Based in Massachusetts, BankFive has been around since 1855. With Bank5 Connect, the online division of BankFive, you can open a checking account, a savings account, or a CD with a low minimum balance requirements. Its accounts are available to everyone in the U.S., except those in Massachusetts and Rhode Island.

As a Bank5 Connect customer, you can enjoy access to thousands of surcharge free ATMs. You may get reimbursed up to $15 per statement cycle for any fees that are charged by out-of-network ATMs. There’s also a mobile app with features like mobile deposit, bill pay, money transfer, and an ATM locator.

16. MoneyLion

Founded in 2013, MoneyLion is a financial services company that works to help customers improve their finances. RoarMoney is its FDIC-insured checking account that comes with no account fees and several unique perks.

As long as you enroll in automatic monthly direct deposits, you can receive each paycheck up to two days early. Price Match will also refund you the difference if you find something you purchased at a lower price. Plus you may use RoarMoney to design a budget and track your spending. In addition to RoarMoney, MoneyLion offers Instcash in which you can get cash advances of up to $250 through the app.

17. Juno

Formerly OnJuno, Juno is an FDIC-backed online banking platform known for its high-yield checking account with zero monthly maintenance fees or minimum opening deposit. You can also earn cash back if you make crypto purchases or cash purchases at certain companies.

It’s ideal if you’re an immigrant or international professional because all you need to open an account is a passport and Social Security number. With Juno, you get free atm withdrawals at more than 85,000 Allpoint or MoneyPoint ATMs.

18. Wise

Headquartered in London, Wise is a financial technology company that prides itself on innovation. You can open a Wise personal account for free and won’t have to meet a minimum balance requirement or pay a monthly fee. Wise is unique in that you can hold 54 currencies and send international transfers to over 80 countries.

There are also international business accounts, which can be helpful if you send, spend, or withdraw money while you travel abroad for business purposes. While you can sign up for a Wise debit card, it does come with fees and may only be used in select countries.

What to Look for When Choosing a Bank

When you shop around Chime alternatives, you’ll notice there are no shortage of options. Here are some things to consider as you look for the ideal solution.

Fees

Fees can add up quickly. Ideally, you’d go with a bank that charges low fees or basically no fees. Fortunately, most online banks are known for their fee-free bank accounts.

With many of these checking accounts, you won’t be charged monthly maintenance fees, ATM fees, wire transfer fees, and early account closing fees. Just be on the lookout for hidden fees.

High Interest and Rewards

The higher the interest rate, the more money you’ll be able to save with minimal effort. Sometimes, you can even earn rewards like cash-back and travel points for making transactions on your debit cards.

Large ATM Network

If you’re an avid cash user, you don’t want to pay an arm and a leg every time you use an ATM. For this reason, it’s important to choose a bank with a fee-free ATM network or one that reimburses you when you use an out-of-network ATM.

Customer Service

You want to ensure that you can easily receive answers to your questions or address your concerns. For this reason, choose a bank or company that has positive customer service reviews.

Bottom Line

While Chime offers many perks, it’s not perfect. If you’re willing to do some research and compare your options, you can find several online banks like Chime. Before you make a decision, look at the banking services provided. Then, weigh the pros and cons. Don’t be afraid to test a Chime alternative for a few months or so to make sure it’s a good fit.

Chime is a financial technology company, not a bank. Banking services and debit card provided by The Bancorp Bank N.A. or Stride Bank, N.A.; Members FDIC. Credit Builder card issued by Stride Bank, N.A.

7. To apply for Credit Builder, you must have received a single qualifying direct deposit of $200 or more to your Checking Account. The qualifying direct deposit must be from your employer, payroll provider, gig economy payer, or benefits payer by Automated Clearing House (ACH) deposit OR Original Credit Transaction (OCT). Bank ACH transfers, Pay Anyone transfers, verification or trial deposits from financial institutions, peer to peer transfers from services such as PayPal, Cash App, or Venmo, mobile check deposits, cash loads or deposits, one-time direct deposits, such as tax refunds and other similar transactions, and any deposit to which Chime deems to not be a qualifying direct deposit are not qualifying direct deposits.

8. A Chime Checking Account is required to be eligible for a Savings Account.

Source: crediful.com

Posted in: Credit 101 Tagged: 2, 2015, 2017, 360 Performance Savings, About, ACH, All, AllY, Ally Financial, Alternatives, app, apple, Apps, ARM, at risk, ATM, Automated Clearing House, balance, Bank, bank account, bank accounts, Banking, banks, barclays, basic, before, Benefits, best, Bill Pay, bills, bitcoin, Borrow, brick, Budget, build, build credit, builder, business, Buy, capital one, cash back, categories, CD, CDs, certificate of deposit, chance, Checking Account, Checking Accounts, Chime, choice, closing, Commercial, companies, company, cons, Credit, credit card, credit cards, credit score, crypto, cryptocurrencies, custom, customer service, Debit Card, debit cards, decision, deposit, Deposits, design, Digital, Direct Deposit, discover, Economy, employer, Entertainment, environment, environmental, estate, Extra Income, Family, FDIC, Features, Fees, Finance, finance app, finances, financial habits, Financial Services, Financial Wize, FinancialWize, Free, friendly, fund, funds, gig, gig economy, goals, good, Google, great, green, groceries, habits, healthy, helpful, high yield, high yield savings, high yield savings account, hold, house, identity theft, impact, in, Income, interest, interest rate, interest rates, international, Invest, Investing, investment, kids, Learn, list, loan, Loans, low, LOWER, luck, Main, maintenance, Make, making, manage, market, Massachusetts, minimal, mobile, Mobile App, Mobile Banking, money, money market, Money Market Account, money market accounts, Money Transfer, More, more money, Mortgages, neobank, new, new york, News, offer, offers, Online Banking, Online Checking Account, Online Savings Account, or, Original, Other, overdraft, overdraft fees, overdraft protection, pay bills, paycheck, payments, paypal, Personal, personal finance, Personal Loans, place, plans, play, points, Popular, prepaid debit cards, price, price match, products, pros, Pros and Cons, protect, protection, questions, rate, Rates, reach, Real Estate, Refund, Rent, Research, retirement, retirement accounts, Review, Reviews, rewards, rewards checking, Rewards Checking Account, right, risk, san francisco, save, Save Money, savings, Savings Account, Savings Accounts, Savings Goals, secured credit card, security, shopping, shortage, Side, Side Gigs, Side Hustle, single, social, social security, Spending, square, state taxes, states, stock, tax, tax refunds, taxes, Technology, theft, time, tips, Transaction, transaction fees, transfer money, Travel, travel card, unique, Utah, venmo, visa, will, wire transfers

Apache is functioning normally

June 2, 2023 by Brett Tams

Current is a digital banking app designed to simplify banking in the modern world. It also includes features for teens and young adults that can help them learn to manage money.

So, how does Current work and what does it cost? We’ll answer all of these questions and more in the Current review below.

What is Current?

Current is not a bank. It’s different from other financial institutions in that it’s a financial technology with a mission to help people make smart decisions about money.

It comes with several perks, like faster paycheck access, savings pods, spending insights, and cash back rewards. Best of all, there are no minimum balance requirements or overdraft fees.

Founded in June 2015 by Stuart Sopp, Current has raised over $400M and landed big name partners and investors, including Mr. Beast, the well-known YouTube star.

Its banking services are provided by Choice Financial Group and Metropolitan Commercial Bank, Members FDIC. In addition, the Current Visa Debit Card is issued by Choice Financial Group and Metropolitan Commercial Bank.

To date, there are about 4 million Current users. Current accounts are currently mobile only as there is no desktop account access or in-person branch network. You can download the Current app on your Android or iOS advice.

Current Features

Current offers several account features that you might find useful, including:

Faster Paycheck Access

Sometimes, you can’t wait until payday and need your hard earned money sooner. That’s where Current’s paycheck access comes in. It will deposit the funds from your paycheck up to two days faster than the typical direct deposit.

Current is unique in that it disregards the date your employer intends to release your paycheck funds. Instead, it works like a prepaid debit card and credits your account immediately after receiving it.

Gas Hold Feature

There’s no denying that the price of gas has skyrocketed. As a result, many gas stations have begun placing holds on the cards of customers. For example, a gas station might place a $100 hold on your card, even if you only purchase $50 worth of gas.

This will ensure you’ll have enough funds to cover the total cost. It can take anywhere from a few hours to a few days for the gas station to release the hold. Current will remove the hold right away so that the funds are readily available to you and you don’t have to wait.

Teen Banking

Current offers a teen account that enables parental supervision and strives to educate teens about proper money management. Its parental features include cashless convenience, instant transfers to teen cards, purchase notifications, and the ability to block specific merchants.

Parents can also use Current’s teen account to set spending limits and chores as well as automate allowance payments. In addition, multiple family members may add funds as they wish.

Savings Pods

With Current’s savings pods, you can meet various saving goals. Here’s how it works: You name a savings pod and deposit money into it from your account or qualifying direct deposit.

You can also add money through the round up feature where you round up to the nearest dollar from any debit card purchases you make.

 At the time this article was written, Current offers 4% APY on $6,000. To take advantage of the interest feature, transfer money from your spending balance to your savings pods.

Note that the type of membership you have will determine how many savings pods you can open. If you’re a basic customer, you’re limited to one pod whereas premium customers get up to three pods.

Cash Back Rewards

Current members can reap the benefits of a generous rewards program. As a member, you can earn up to 15x points on purchases you make at over 14,000 retailers. These retailers include Rite Aid, Cold Stone Creamery, Rite Aid, Subway, Forever 21, Burger King, and others that are listed in the Points tab in the Current app.

You may redeem these points for cash back in your Current account. You’ll receive the points right after you make a qualifying purchase and can redeem 100 points per dollar.

According to Current, its members have the potential to earn $165 cash back per year by simply using their card at participating gas stations. Keep in mind that Premium customers have the potential to earn more points and cash back than Basic customers.

Instant Cash Deposit

Current lets you easily deposit cash into your account. You may instantly add cash at over 60,000 at convenient places like local grocery and convenience stores, including Walmart and CVS. This is a huge selling point.

To deposit cash with Current, find a nearby cash deposit location, tap “view barcode” from the map, show the barcode to a cashier, and give them the funds. You can add up to $500 per transaction or up to $1,000 per day and $10,000 per month. The money will show up in your Current bank account immediately.

Overdraft Protection

The app does more than eliminate overdraft fees. If you overdraft your account by accident, you’ll get a free pass. The Overdrive feature offers a fee-free overdraft of up to $200 on in-store and online purchases.

To qualify for it, you must be 18 years or older and receive $500 or more in eligible direct deposits each 30-day period. A qualifying deposit can be an ACH transfer from your employer, payroll company, or Social Security. Unfortunately, mobile check deposits and peer-to-peer transfers don’t count.

Cryptocurrency

With Current, you can buy and sell cryptocurrency from the same app. Fortunately, you don’t have to worry about any trading fees or wait days for your trade to settle. You can purchase 27 popular coins, like Bitcoin, Dogecoin, Ethereum, and Shiba Inu. Once you sell a coin, you’ll notice the cash in your Current account immediately.

Money Management

Current’s money management tools can come in handy if you’re looking for a way to take control of your personal finance and make the most out of your money. The Spending Insights feature, for example, is available on your home screen.

It lists your recent purchases and assigns them a spending category so you can easily see where your cash is going. You may also sign up for real-time notifications that will appear any time you make a debit card purchase.

While the Spending Insights feature is designed to help you track your spending, the Budgets tool if your goal is to prevent overspending. You can create budgets for various categories. As you approach your budget or spending limit on an account ownership category, you can receive updates and make changes accordingly.

Current Pay

Current Pay works a lot like Apple Pay, Venmo, Zelle, and PayPal. If you know others that use the app, you can pay and request money from them instantly. Best of all, the process is easy and doesn’t involve any fees.

Does Current Have Transaction Limits?

Despite all of Current’s handy features, the app does impose transaction limits you should be aware of. These include a $500 daily maximum in ATM withdrawals, $2,000 daily maximum in card purchases, and $5,000 maximum transaction amount for peer-to-peer payments through Current Pay.

Are There Any Fees?

Now it’s time to discuss Current review fees. You may be surprised to learn that Current doesn’t charge monthly maintenance fees or have any minimum balance requirement requirements.

Additionally, there are no overdraft fees, or money transfer fees for money transfers from an internal bank account or external bank account or ATM fees at 40,000+ Allpoint ATMs. This is great news if you’d like to try it out with no strings attached.

But keep in mind that you may face out-of-network or third-party fees. For example, if you use Current at an out-of-network ATM, you’ll get charged $2.50. International withdrawals cost $3 each.

In addition, if you’d like, you can upgrade from the Basic membership plan to the Premium account or membership plan. While this will come with an additional monthly fee of $4.99, you’ll get access to more features, like additional savings pods and the chance to earn more cash back.

Who is Current best for?

Current might be worth exploring if you don’t mind mobile banking. It can help you meet smaller savings goals with a high interest rate. It’s also ideal if you use your credit card frequently and hope to earn generous cashback rewards.

In addition, you may benefit from Current if you’re a parent or guardian that wants an account for your teen and wishes to instill healthy money habits. We also recommend Current if you’re unable to qualify for a traditional banking account and are looking for a viable, cost-effective alternative.

Current Pros and Cons

Just like any digital banking app or online bank, Current comes with several benefits and drawbacks, including:

Pros

  • No monthly fees: You can use Current without committing to monthly usage fees.
  • Generous APY: Current offers 4% APY on up to $6,000 in savings to help you expedite your savings goals.
  • Cash back: Unlike most debit cards, Current rewards you with cash back every time you make a purchase at 14,000+ participating retailers.
  • Early paycheck access: You may access the money from your paycheck up to two days sooner.
  • Instant gas hold removals: If a gas station places a hold on your account, Current will remove it immediately.
  • Teen features: Current comes with plenty of features you can use to help your teen become responsible with money.

Cons

  • No online or in-person banking: You can only use Current on your iOS or Android device as Current’s mobile app currently doesn’t support online or in-person banking at a local branch.
  • No checks: The Current app doesn’t offer checks so you’ll have to find an alternative payment solution.
  • Email-based support: If you have a question or concern, Current will only be able to help you via email support is not available.
  • Mobile check deposit feature is slow: It can take up to 5 business days for a check deposit to clear.

How to Use Current

If you’d like to sign up for Current, follow these easy steps.

  • Download the app on the Google Play Store or Apple App Store. You can also enter your phone number on Current’s website and receive a download link.
  • Share basic personal information including your name, phone number, email address, residential address, and Social Security number.
  • If you’d like, connect Current to a debit card or bank account to fund your account.

Once you sign up, you’ll receive a Current debit card by mail. It should arrive via USPS within 7 to 10 business days but you can use Current before then. Current will give you a virtual card you can add to your digital phone wallet while you wait for your physical card.

Current Reviews

Before you go ahead and sign up for the Current app, you might be wondering what other Current account holders have to say about it. Here’s an overview of the various reviews we found online.

TrustPilot

On TrustPilot, Current earned 3.8 out of 5 stars. Most reviewers praise the app but there are several complaints about Current customer support and challenges with disputes.

Apple App Store

Current users gave it a 4.7 out of 5 stars on the Apple App Store. There are over 84K reviews and any of the negative ones relate to customer service.

Google Play

When it comes to the Google Play Store, Current ranked well as well with 4.8 out of 5 stars from over 89K reviews. Again, the negative reviews are about customer service and resolving disputes.

It’s no surprise that customer service is Current’s most noteworthy downfall as it’s only available via email and in-app chat that sometimes doesn’t work. If you have an urgent question while using the app, you won’t be able to make a phone call and receive a quick response. Depending on when you send the email, you may have to wait a few business days or even longer to hear back.

Speaking of customer service, you might want to know how to go about it. You can use the in-app chat feature or fill out an email form and wait for an email response. As stated, there’s no way to call the Current team for faster support.

The good news is the app is fairly intuitive and you shouldn’t come across too many issues while using it, especially if you consider yourself tech savvy. Plus you can check out Current’s frequently asked questions on its website for answers to simple, less urgent questions.

Current Alternatives

While Current is a solid online banking app for many adults, teens, and young adults, it’s not for everyone. If you find that Current isn’t right for you or are wondering about alternative options, here are a few to consider.

Chime®

Just like Current, Chime is a financial technology company or fintech company with modern features you may not find at a traditional bank, credit union, or brick-and-mortar financial services company. It offers early direct deposit2, savings roundups, and no-fee overdrafts5.

Compared to Current, it’s more like a high yield savings account8 in that it lets you earn a better APY on your savings on your entire balance, rather than just up to $6,000.

In addition, there’s a Credit Builder7 account you can use to boost your credit without a credit check. Just keep in mind that Chime doesn’t offer a teen account like the Current teen account.

Read our in-depth Chime review here.

See also: Chime vs. Current: Which Is Better?

Greenlight

While Current is intended for teens and their parents, Greenlight’s online banking services are geared toward younger children in elementary school. Both apps come with parental controls and features such as spending limits, chore rewards, transaction monitoring, and the chance to blacklist set retailers. Greenlight also lets you invest in the stock market.

Bottom Line

Current offers a long list of features that make it a smart choice if you want a digital banking platform with no monthly fees or hidden fees. You can enjoy early paycheck deposit, no overdraft fees, teen savings accounts, cash back rewards, savings pods, and more.

As long as you’re okay with limited customer service and don’t mind using the app on your mobile device, it’s certainly worth exploring.

Current FAQs

Here are a few of the most common questions that many people ask about the Current digital banking app.

Is Current safe?

It’s a risk to use any type of mobile or online banking platform. But Current checking accounts and teen accounts are backed by FDIC insurance of $250,000 in the event of a bank failure. Plus just like many reputable online banks, the app uses bank-level data security measures and you can sign up to receive push notifications any time current detects account fraud.

Does Current have any physical branches?

At this time, Current does not have any physical branches. This means you won’t be able to receive in-person service. The good news, however, is it does offer fee-free cash withdrawals at over 40,000 Allpoint ATMs throughout the country.

Can you deposit cash into your Current account?

Yes, Current lets you deposit cash. However, cash deposits aren’t free and you will have to pay $3.50 for every cash deposit transaction.

What happens if you overdraft your Current account?

Thanks to the Overdrive feature, it’s no big deal if you overdraft your account.  You can enjoy a fee-free overdrive of up to $200 on any purchase you make in-store and online.

Can you earn rewards or bonuses with Current?

Absolutely! As long as you use the Current Visa debit card at participating retailers, you can earn cash back. Plus you can earn $1 every time you refer a friend who signs up for a Current account.

Is Current worth it?

If you’re looking for a free checking account with plenty of bells and whistles or a teen banking account, the Current mobile app should be on your radar. But if you prefer a more traditional banking experience, you might be better off with an account at a local bank or credit union.

Chime is a financial technology company, not a bank. Banking services and debit card provided by The Bancorp Bank N.A. or Stride Bank, N.A.; Members FDIC. Credit Builder card issued by Stride Bank, N.A.

2. Early access to direct deposit funds depends on the timing of the submission of the payment file from the payer. Chime generally make these funds available on the day the payment file is received, which may be up to 2 days earlier than the scheduled payment date.

5. Chime SpotMe is an optional, no fee service that requires a single deposit of $200 or more in qualifying direct deposits to the Chime Checking Account each at least once every 34 days. All qualifying members will be allowed to overdraw their account up to $20 on debit card purchases and cash withdrawals initially, but may be later eligible for a higher limit of up to $200 or more based on member’s Chime Account history, direct deposit frequency and amount, spending activity and other risk-based factors. Your limit will be displayed to you within the Chime mobile app. You will receive notice of any changes to your limit. Your limit may change at any time, at Chime’s discretion. Although there are no overdraft fees, there may be out-of-network or third party fees associated with ATM transactions. SpotMe won’t cover non-debit card transactions, including ACH transfers, Pay Anyone transfers, or Chime Checkbook transactions. See Terms and Conditions.

7. To apply for Credit Builder, you must have received a single qualifying direct deposit of $200 or more to your Checking Account. The qualifying direct deposit must be from your employer, payroll provider, gig economy payer, or benefits payer by Automated Clearing House (ACH) deposit OR Original Credit Transaction (OCT). Bank ACH transfers, Pay Anyone transfers, verification or trial deposits from financial institutions, peer to peer transfers from services such as PayPal, Cash App, or Venmo, mobile check deposits, cash loads or deposits, one-time direct deposits, such as tax refunds and other similar transactions, and any deposit to which Chime deems to not be a qualifying direct deposit are not qualifying direct deposits.

8. A Chime Checking Account is required to be eligible for a Savings Account.

Source: crediful.com

Posted in: Credit 101 Tagged: 2, 2015, 2023, About, ACH, advice, aid, All, allowance, Alternatives, android, app, apple, apple pay, Apps, ask, ATM, Automate, Automated Clearing House, balance, Bank, bank account, Banking, banks, basic, before, Benefits, best, Best of, big, bitcoin, bonuses, brick, Budget, budgets, builder, business, Buy, cash back, Cash Back Rewards, categories, chance, Checking Account, Checking Accounts, Children, Chime, choice, clear, Commercial, company, cons, Convenience, cost, country, Credit, credit card, credit check, credit union, credits, cryptocurrency, customer service, data, data security, Debit Card, debit cards, decision, decisions, deposit, Deposits, Digital, Direct Deposit, dogecoin, Economy, employer, ethereum, event, experience, Family, FDIC, FDIC insurance, Features, Fees, Finance, Financial Services, Financial Wize, FinancialWize, Fintech, fraud, Free, free checking, fund, funds, gas, gas stations, gig, gig economy, goal, goals, good, Google, great, greenlight, grocery, guardian, habits, healthy, high yield, high yield savings, history, hold, home, hours, house, How To, in, Insights, Insurance, interest, interest rate, international, Invest, investors, iOS, Learn, list, lists, Local, maintenance, Make, manage, Manage Money, market, member, mobile, Mobile App, Mobile Banking, Mobile Check Deposit, modern, money, Money habits, Money Management, Money Transfer, More, News, no fee, offer, offers, Online Banking, online purchases, or, Original, Other, overdraft, overdraft fees, overdraft protection, ownership, parents, party, paycheck, payments, paypal, Personal, personal finance, personal information, place, plan, play, points, Popular, premium, prepaid debit card, price, pros, Pros and Cons, protection, Purchase, questions, rate, refer a friend, Residential, Review, Reviews, rewards, right, risk, safe, Saving, savings, Savings Account, Savings Accounts, Savings Goals, School, security, Sell, selling, simple, single, smart, social, social security, Spending, stock, stock market, tax, tax refunds, Tech, Technology, The Stock Market, time, timing, tools, trading, traditional, Transaction, transfer money, unique, updates, upgrade, venmo, virtual, visa, walmart, wants, will, work, young, young adults, youtube

Apache is functioning normally

June 1, 2023 by Brett Tams

How would you feel if the financial adviser you hired to take care of your investments had four previous instances of customers filing a complaint against them? What if they had been fired from two previous financial institutions? Hopefully it would give you the same sick feeling it gives me.

How would you feel if you learned that you could have discovered all of this if you had spent less than 10 minutes doing some online research? Don’t answer that quite yet. More on that in a bit…

Navigating the choppy waters of the investing world isn’t easy. You’ve got a multitude of account options to consider and even more investments and insurance to protect your family. Having a solid financial adviser by your side to guide your ship through to calm waters is an invaluable asset.

Unfortunately, the act of finding a good adviser is difficult, and there is a sea of job titles to understand that potentially confuse the issue. Some of them are meaningless and don’t describe the depth of knowledge or experience required to acquire the title. Others take years of experience and study to pursue, but the title may not help you discern that. You want someone on your team with the latter, not the former.

Yet even finding the right designation isn’t a guarantee you’ve found a good adviser. Some advisers are just out to make a buck while others have unrealistic expectations about what kind of returns can be earned in the market. (There are 7 types of financial advisers I want to punch in the face, so make sure your adviser doesn’t have any of these qualities either.)

Once you have a list of candidates in front of you, the next step is to find out about your adviser’s background. Grab your shovels; we’re going digging.

How to check your financial adviser’s background and qualifications

Here are seven ways to check up on a financial adviser’s background and professional qualifications. It might look like a lot of effort — but work with me, people! The following can be done in less than 30 minutes. Unfortunately, some of my clients learned that the hard way.

The clients were in their 70s and didn’t have a good feeling about their adviser. Their kids shared their sentiments and reached out to me. After spending a total of 15 minutes doing some research online, I discovered terrifying news: There were four separate instances where a client had filed a complaint against the adviser. In fact, he had been let go from his previous brokerage firm because of the complaints.

A few of the allegations included “breach of fiduciary duty” and “fraud.” I don’t know about you, but I wouldn’t trust someone to manage my money who can been involved in several wrongdoings. These are the grievances we know about. What about the ones we don’t?

You’re willing to spend four days researching the best price and deal on your next big-screen TV purchase, right? By comparison, for less than an hour of your time, you can protect yourself — your retirement, your investment in your kid’s education, and your overall financial well-being — from a scam artist. Presumably, it’s worth your time. Let’s get to work.

1. Understand the adviser’s credentials
Just because someone has a crazy alphabet soup of titles behind their name on their business card doesn’t mean they are truly qualified to be your financial adviser. Do some research on the actual credential first. You can use Investor Watchdog’s Here’s what it takes to become a CFP.) You have to have two to five years of experience. There is a ton of studying involved. The test takes forever (not everyone passes) and there are continuing education requirements to keep the CFP designation.

If someone tells you they are a CFP, that’s great, but you need to verify. Pretty much all of the quality credentials offer a search function on their website, and the CFP Board is no different. You can do a search under Find a CFP Professional.

If you did a search for me, this is what you would find:

cfp board search
My info on CFP.net

As you can see, it shows that I received the CFP designation in 2008, that I haven’t had a bankruptcy in the last 10 years, and that I’ve never been disciplined by the CFP Board. If your adviser doesn’t show up in the search or has disciplinary action from the board, that is a red flag.

3. Perform a FINRA Broker Check
Next you will want to perform a FINRA Broker Check. FINRA stands for “Financial Industry Regulatory Authority.” It is the largest independent regulator of securities firms in the United States.

Broker Check will show you:

  • whether the adviser is registered with FINRA. (I haven’t been since 2011 when I left my employer to start my own financial advising firm.)
  • which industry exams the adviser has passed, such as, the Series 7 (to become a stockbroker, broker-dealer, or Registered Representative) and Series 66 (to become an Investment Adviser Representative).
  • any disciplinary action that has been taken against the adviser.
  • the adviser’s previous employment history for the last 10 years. (If they change brokerage firms every 12 months, that would be a concern.)
  • states in which the adviser is allowed to do business. (If your state is not listed, run!)
  • any outside business interests that the adviser has. (If part of his pitch is to get you to invest in a new condo development and it turns out he owns a majority stake in it, run!)

I had to drop my Series 7 when I started my own firm, so that’s why I’m not registered with FINRA. Even so, it makes sense to check my information with this tool. I voluntarily dropped my Series 7 so my info still looks clean in FINRA’s eyes. But what if I was no longer registered with FINRA because they had to discipline me four times? Look out!

4. Perform SEC and NASAA searches
Your next stop on the research train is the good ol’ SEC. No, I don’t mean college football. We’re going to check in with the regulators at the Securities and Exchange Commission.

Generally speaking, if you are in the business of giving advice on investing in securities, you must either register with the SEC or register with your state’s regulatory authority. You register with the big boys if you manage more than $25 million in client assets. Smaller than that and you are your state’s problem, not the SEC’s.

The SEC has a ton of good information on avoiding scams on their website, and they offer a broker search as well. The only info I could find on me was from FINRA’s Broker Check which the SEC utilizes. If I worked for a massive firm, you could search that as well.

The SEC will also point you to the North American Securities Administrators Association. This is the association of state regulators, and for over 100 years they have defended the small investor from local scams. You definitely want to check in with them even if it means you actually — gasp — have to pick up the phone and call the state regulators yourself. NASAA says it best on their site:

“State securities regulators should be the first call for an investor before you turn over any money to a broker or investment adviser. You can access extensive employment, disciplinary, and registration information about your stockbroker or investment adviser through your state securities regulator.”

5. Ask individuals you trust
So you’ve done your “official” homework. You poked around at the regulatory bodies that should know about serious wrongdoing by your potential adviser. Don’t stop there.

The searches above are only going to show you the grievous offenses by the adviser. Those are absolutely critical to know, but it doesn’t paint the full picture. You also need to know simple things like if the adviser calls his or her clients back in a timely manner and whether or not people actual enjoy using his or her services.

So ask around. Ask your friends, colleagues, and family members. Have they heard of the adviser? Good? Bad? Indifferent?

Reputation in the local area is a big deal. Do take everything with a grain of salt — just because one person is super upset doesn’t mean the adviser is terrible — but a bunch of bad comments would be of concern.

6. Check out the web and read social media profiles
Lastly there is this one amazing tool that I’m sure you’ve never heard of.

Are you ready?

It’s called Google.

I know, right? Crazy. You can search for your potential adviser’s information on Google. Seeing a lot of news articles about a Ponzi scheme they might be running? You know what to do. (Hint: Run quickly to the nearest CFP with a fiduciary duty to you.)

You can also check out Facebook profiles, what they’re saying on Twitter, or if they have any recommendations on LinkedIn. These social media tools will give you a better idea of the type of person who will be investing your money. Maybe they went to your university’s rival school and you just can’t bring yourself to trust “them,” or maybe their Facebook page is full of photos of an event at your favorite non-profit and you feel an instant connection.

You don’t have to be best buddies with your adviser, but understanding who they are and how they act outside of the formal, professional website for their services is important too.

7. Ask the adviser this critical question
You’ve whittled your list of potential advisers down to a few key people. It’s time to sit down with them in person for your first consultation. (Hopefully it’s free.) You can talk about their experience, background, exams, and all that. That’s fine.

But there is one thing you really need to ask: “Mr. Adviser, do you have a fiduciary duty to me?”

Any answer other than an immediate “yes” should make you uncomfortable. Fiduciary duty is where someone legally puts your best interests above their own.

Let’s say that one more time so it sinks in. If your adviser has a fiduciary duty to you, they must legally operate in a way that puts your interests above their own.

How about the opposite? If your adviser doesn’t have a fiduciary duty to you, then they can operate so that they put their best interests above yours. That means they could put you in expensive investments with high fees that they get paid a huge commission on when there are better, less expensive alternatives available.

An adviser who doesn’t put you first is one whom I would be hesitant to hand my financial future to because there’s no guarantee he or she won’t do whatever they want with my money to earn themselves an income rather than to protect my financial assets.

I mention asking this question in person versus on the phone because you want to see if the potential adviser squirms or tries to walk around the question. You deserve a straight answer and you want to see how they react.

Protect yourself with a little effort

What’s sad to me as an adviser is it is pretty rare for someone to go through all of these steps, yet they take so little time to perform. Again, think about your last major purchase whether it was a car, a refrigerator, or a TV. You probably spent hours standing in the big box store staring at the TV screens, going home, and reading technical reviews online. And that’s for a television.

Invest a little bit of time to make sure you aren’t going to ruin your entire financial future by signing up with a scam artist rather than a legitimate financial adviser. You’ll be glad you did.

Source: getrichslowly.org

Posted in: Investing, Taxes Tagged: About, action, actual, advice, All, Alphabet, Alternatives, ask, asset, assets, bankruptcy, before, best, big, Broker, brokerage, brokerage firms, business, calm, car, Clean, College, college football, commission, condo, Development, education, employer, Employment, event, expectations, expensive, experience, facebook, Family, Fees, fiduciary, financial well-being, Financial Wize, FinancialWize, FINRA, football, fraud, Free, front, future, Giving, good, Google, great, guide, Hiring, history, home, hours, How To, in, Income, industry, Insurance, Invest, Investing, investment, investments, Investor, job, kids, learned, list, Local, Make, manage, manage my money, market, Media, money, More, new, News, offer, or, Other, paint, photos, pretty, price, protect, Purchase, quality, ready, Regulatory, Research, retirement, returns, Reviews, right, running, scam, scams, School, search, SEC, securities, Series, Side, simple, sinks, social, Social Media, Spending, stake, states, studying, television, time, title, tools, trust, tv, Twitter, under, united, united states, versus, will, work
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