What Are Internet Bank Accounts?

While internet bank accounts can help you earn more interest, you have to make sure you get the right one. Compare the most common features of internet bank accounts and decide which ones are most useful to you.

Overview of Internet Bank Accounts

What exactly is an internet bank account? It means an account that's only offered online. While you may be able to bank with the same institution the old-fashioned way (in person), internet bank accounts are usually only offered to online users.

Aside from the ability to bank in your bathrobe, what are the major advantages of internet bank accounts? The answer is simple: Annual Percentage Yield (APY). By conducting your transactions online, you save the bank money which it ideally passes on to you in the form of higher savings rates.

Key Considerations for Internet Bank Accounts

When shopping among internet bank accounts, you’ll want to look at some key features. Not every bank offers everything, so you have to decide how important these are to you.

  1. Usually the most important attraction for rate shoppers (Savings Account Interest Rates)
  2. Access to the money. If you want to take it and spend it, how much work do you have to do?
  3. Number of linked accounts. Can you set up a network of accounts and zap money back and forth through your internet bank account?
  4. Additional products and services. Can you buy CDs, get a mortgage, or pay bills online?
  5. Leverage of existing banking relationships. If an institution that you already deal with has an internet bank account, you may qualify for some extra perks by keeping all of your business in one place.
  6. Customer service options. How easy will it be to get questions answered?
  7. Automatic savings plans. Can you put it on auto-pilot and let the money accumulate automatically?
  8. Safety and security. Is the bank FDIC-insured, and do you trust their security process?
Once you compare the features of various internet bank accounts, you can decide which one is best. For example, you may decide that APY is most important to you. Therefore, you wouldn’t care about any other options – you’d just pick the bank with the highest APY.

Source: www.about.com