Another no-fees no-minimums online savings account has arrived. This time it’s E-Trade Bank with the Max-Rate Savings Account. After looking around, here are what I see as the pros and cons of this account as compared to other online banks.
- No minimum balance, $1 to open, no account fees
- Competitive, but not exceptional (updated) 3.30% APY interest rate.
- E-Trade Bank has a great online funds transfer system. It is CashEdge-based so you can basically link almost any external bank account (also seen at HSBC, Bank of America). But what sets it apart is its transfer speed, allowing round-trip funds transfers with zero days of lost interest. Transfers both in an out are free.
- If you use E-Trade as your broker, can transfer between E-Trade accounts instantly. It appears that you can’t use this as your sweep account though.
- I have opened a few E-Trade bank accounts in the past (for bonuses), and was not hit with a hard credit pull.
- Competitive, but not exceptional interest rate. You may already be getting a similar rate, or be able to do better elsewhere, especially if you have higher balances.
- I have had bad experiences with E-Trade brokerage, including hour-long hold times and slow service. I’m not sure if the bank has a separate customer service department.
If you already use E-Trade, opening a Max Rate savings account is probably a no-brainer due to the lack of fees. For others that move money around a lot, it may be also be useful to open one these accounts to take advantage of those fast interbank transfers.