Dollar Savings Direct is offering an incredibly high interest rate for online savings accounts at 3.75% APY. While this online savings account interest rate is not as high as current CD rates, it is definitely higher than most brick & mortar banks and comparable online banks. They do require a low $1,000 minimum deposit to open a new savings account. DollarSavingsDirect.com is a an online division of Emigrant Bank and is FDIC insured.

Other online bank account savings rates:

• fnbo direct - 3.50% APY
• hsbc - 3.25% APY
• ing direct 3.00% APY
• eloan - 3.01% APY

Countrywide Bank has the best online savings account rates at 5.00% APY. Compare this with the other companies and they come out on top.

• eTrade: 4.40% APY
• ING DIRECT: 3.65% APY
• HSBC Direct: 3.80% APY
• Eloan: 4.00% APY

You will need to maintain a minimum of $10,000 in your account to get the highest rate of 5.00% APY.  Balances less than 10,000 only earn 4.00% APY, however this still isn’t bad considering the competition.

I had an online savings account with Eloan for almost a year because of their high rates. It turns out they were lacking in a few areas that made me close my account with them and switch to ETrade.

When I opened my account with Eloan their rates were very high-around 5.4% APY for an online savings account. ING DIRECT was only offering about 4.5% at this time. I still have an account with ING DIRECT since they have rich full featured easy to use customer interface.

I accidentally made a duplicate transfer from my linked checking account into my online savings account at Eloan.  I realized that this transfer was a mistake just minutes after I made the online transfer and looked for a way to cancel it.  There was no way to do this online.  I immediately called their customer service line to get this canceled however they they stated that they were unable to do so since everything is “automated” and NOBODY has the power to stop this process once it has started.  To top it all off their customer service reps were unprofessional and insensitive to my situation.

Reasons why you might not bank with Eloan:

1. Inability to cancel transfers
2. Poor customer service
3. Cannot schedule future transfers
4. Cannot schedule reoccurring transfers

Right now ELOAN has the best CD rate for 3 month CDs at an 5.55% APY.

This is even higher than their 6 month CD that is at 5.20% APY. Opening a 3 month CD with ELOAN is one of the smartest investments that you can make if you are looking for a short term no risk investment.

If you need access to your money frequently then consider their online savings account. At 5.25% APY, ELOAN beats ING DIRECT by a whopping .75% APY!

There’s a $10,000 minimum to open any CD account at ELOAN and they are FDIC insured.

WTDirect (the online division for Wilmington Trust) is offering their online savings account at 5.26% APY. This appears to be a good rate for online savings initially however here is the fine print:

• No minimum deposit
• For the first 60 days you will earn 5.26% APY on all your money
• After 60 days you will only earn 5.26% APY on your money if you have over $10,000 in your account
• For balances less than $10,000 you will only earn 0.60% APY

This is obviously not a good choice for people that will have less than $10,000 in their account. You can get higher rates at a normal bank such as US Bank or BofA. They are FDIC insured.

Countrywide Bank is offering a high rate Online Savings Account at 5.40% APY. This is a great rate for an online savings account if you don’t already have one.

• There is a relatively high minimum deposit of $50,000 to qualify for this rate.
• You are limited to 6 withdrawals per month.

Also check out their 5.40% 6 month CD.

FNBO Direct is offering their online savings account at an amazing 6.00% APY with $1.00 initial deposit and no minimum monthly balance. This rate is guaranteed until September 28, 2007 so you still have time to make some money on this deal. There are potential fees associated with this FNBO Savings Account:

• ATM Cash Withdrawal - $2.50
• ATM Balance Inquiry - $1.00

And you will also be subject to the typical bank fees should you do something to incur them (read details here.) The biggest negative about this account would be the 6 transfer or withdrawal limit per month. This restriction may not bother some people however it is still a factor to take in to consideration if you need access to your money often.

iGOBanking.com is offering their online savings account at 5.30% APY.

Good:

• No minimums
• Highly competitive rate for savings
• CD Rates aren’t bad (currently 5.30% APY for a 6 month CD)

If you’re planning on opening CDs in addition to your online savings account then it may be better to go with a bank that consistently has higher CD rates. INGDIRECT for example may be a better choice because of the ease of opening additional accounts (both savings and CDs.)

ING DIRECT has their standard Online Orange Savings Account at 4.50%. Here are some of the benefits of having an account with ING DIRECT:

• no minimum deposit required
• unlimited withdrawals and deposits
• ability to schedule future and/or recurring deposits
• highly competitive interest rate
• ease of opening additional accounts (you can open additional savings accounts and CDs with just a few clicks)

Citibank is offering their online savings account at 4.65% which is better than average but not as high as the best banks out there. However the $100 dollar bonus is definitely something to consider. Take advantage quickly because this offer expires on May 31, 2007.

• No minimum deposit
• No fees
• You can get your money through Citibank ATMs at no additional charge
• Only available to first time Citibank deposit account customers

Click here to open a Citibank Direct Ultimate Savings Account with $100 bonus