The Biggest Downsides Of Having An Online Savings Account
The upsides of an online savings account are many. However, everyone can’t always enjoy its full benefits. Online savings accounts do seem like a fantastic option. But, in spite of having a lot of perks attached to them, there are certain disadvantages that you must know. When you compare interest rates of your local bank to your online savings account, you will find the latter to have a higher one. Not to forget, it’s always easier to open an account at your local bank. After considering every aspect and assessing them, listed below are a few downsides of having an online savings account.
Restrictions On Transfer Limit
Certain online banks impose a transfer limit on all your withdrawals. It’s different from the six withdrawals that you avail every month. This cannot be considered a problem but when you take out your money for the down payment, it’s a hassle that’s certainly not needed. A representative from customer service will instruct you to wire out around $20, but that’s not something that might seem unpleasant. There is no official form available, and you might have to write a letter informing your requirements, sign it, and fax the letter to the concerned department and wait for someone working in the transfer department to contact you. Normally, it can take 48 hours or even more. Add another two hours to it to have your amount wired. Things might worsen if you are late in initiating the procedure.
Limitations On Your Online Savings Accounts
It’s normal to be excited when you open a savings account online. But it’s only you who will benefit if you go through the fine print first. There are a few online savings accounts that wouldn’t allow you to open an account until and unless you have the minimum balance required. There are others that wouldn’t even provide you with the highest rate in case you are not able to maintain a certain amount. Aside from these, there are banks that don’t even discuss the offered rates. When you want to finalize your loan, the loan officer might ask for deposit verification on one of your online accounts. Generally, the process seems to be simple and can be taken care of by the banks themselves. It’s good from a security point of view. However, if you ask for a confirmation receipt, there are a lot of complications that you probably have never encountered. The mail service may not always be up to the mark, and you might have to wait for ages before you get hold of a particular service.
Online Only Interface
The absence of a bank location might work in your favor, especially when it’s 2 AM and you might want to carry out some financial transactions or after you have waited long in a queue and have been irritated while dealing with bad-tempered tellers at the counter. However, you might not have thought about the disadvantages that can accompany the absence of a physical bank branch. The first problem that you are likely to face is the lack of support. You might be highly disappointed on that front. If you are asking for customer service from online banks, you will be treated with online chats, emails, and phone calls. Phone reps might provide a helping hand, but no one can guarantee that all your queries will be answered or help in discarding any concerns that you might have. In addition to that, the only way to get hold of your cash is through electronic means.
To decide if an online savings account fulfills your requirements, you have to check out your comfort level. If you are okay with the online world and are completely at ease with the facilities and terms that are provided by online banks, online accounts truly can prove to be a huge investment opportunity. Just make sure that you check out every aspect before you come up with a decision including the disadvantages that are attached to online savings accounts.
Online banks can bring around a lot of stress. They can prove to be more stressful than loans. The rates are indeed a bit on the higher side. Ensure that you have all the information regarding what to do when you need to get hold of your cash in case of an emergency.
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