Internet-based banks
 

How many people here use Internet-based banks for their higher interest rates? I opened up a savings account at my local bank and wasn't too pleased with the whopping 0.47% APR. Did some searching around online, and opened an account on www.ingdirect.com. 2% interest, no fees, no miminums.

It doesn't have real branches, it's entirely online, which was a little unsettling at first. But I decided to go for it, and I'm very happy.

I think now that people are getting used to the idea of money more as just a number rather than a stack of green paper, combined with the fact that most people are getting increasingly comfortable using debit/credit cards for everyday purchases, those banks are going to get a lot more popular. And brick and mortar banks will have a much more difficult time trying to compete when they offer only 1/4th of the interest rate. What are your thoughts?

There's also netbank, which I have not personaly used. How long have you been using ing driect? Are you happy with them?

I'm intrigued, but how do you make deposits?

Also, with no ATMs, do you have to pay a fee everytime you withdraw money?

I don't see the problem with it as long as they have sort of real office and they are insured. Though like every net business, you run the risk of them closing down shop overnight and taking your money.

I use Netbank for virtually all of my short-term savings (I have the net of my paycheck deposited there after car payments and a couple of bucks for lunch money). The account is FDIC insured up to $100k I believe, and it comes with free bill recieve/pay.

Good deal.

I don't think so, I'm pretty sure that's want the FDIC is for; preventing the banks from shutting down and you losining your money.

Yeah as long as they are indeed FDIC insured you will get your money back up to $100,000.

I still want to know though, if my grandma gives me an old fashioned paper check for my birthday, how do I deposit it?

Netbank will send you postage paid envelopes and deposit slips (for free) to mail them back deposits. They also have agreements with some banks for use of their ATMs.

I also keep an account at a brick & mortar bank for just this reason. I keep my monthly lunch cash there, and use it for deposits of checks. Then if I get a large enough sum of cash/checks, I'll desposit it at the B&M bank, and electronically pay off my revolving credit card debt.

You can also just give the bank the check number IIRC and whatever other info they need to deposit it.

I use ING Direct and haven't had a problem (I actually used to do IT for them :P). I wish the bank transfer times between your bank and them were faster.

Icky, you make electronic transfers from your bank to them through your checking account.