Online banking has become the norm in many households over the past few years. An online savings account is relatively easy to set up and manage, provided you already have a regular checking account in a brick-and-mortar bank. Most of the wholly online banks like ING and Emigrant Express require having a checking account to link the online accounts to. The regular accounts are used to verify identity and make it easier to transfer funds into the online account.
Setting up an Online Savings Account
- Investigate online banks. There are several reputable online banks that offer online savings accounts, like ING, Emigrant Express and Capital One. Make sure any bank you choose is insured through the Federal Deposit Insurance Corp. Online savings accounts usually pay a higher interest rate than brick-and-mortar banks. Find the one that will meet your needs in terms of deposit requirements, interest rates and ease of access.
- Choose the bank you wish to use and complete the online application process. This involves providing personal information like address, phone number, Social Security number and regular bank account information. The online bank will typically make two small (less than .05 cents) deposits into your regular account to verify the account.
- Make the first deposit to the online account once the two small deposits have been received. Do this by logging in to the online savings account, entering your password, then choosing the transfer funds or deposit funds option. Follow the instructions, setting the amount of the transfer and the date you want it to occur.
- Schedule the deposit by indicating how much you want to transfer from the regular account to the savings account. It sometimes takes two or three business days for the deposit to appear in the savings account, and it may be on a pending status for a day or two before the funds will be available.