Review of Dollar Savings Direct
If you’ve reached the point in your financial life when you have some spare money after covering expenses, first of all, congratulations! That’s a big deal, and you should feel good about all that you’ve accomplished so far. Now the question becomes just what to do with this surplus of cash, and in this Dollar Savings Direct review, we’re going to explore one of your options.
Dollar Savings Direct (stylized as DollarSavingsDirect) is the online banking division of Emigrant Bank, the oldest savings bank in New York City and the largest privately held, family-owned-and-operated bank in the United States today. The bank has been around since 1850, and it currently manages nearly $6 billion in assets. That’s all to say that this is no fly-by-night operation, despite the fact that its website feels stuck somewhere in the early 2000s!
This Dollar Savings Direct review will examine the positives and negatives of Dollar Savings Direct savings accounts. Let’s start with the good before moving on to the not so good:
Dollar Savings Direct Positives
Whereas many traditional, brick-and-mortar banks are currently offering interest rates as low as 0.01% APR, cash stored in Dollar Savings Direct accounts are now racking up 1.8% interest annually. This isn’t among the absolute highest interest rates available today, but it’s still far better than the current national average of around 0.3%!
Another positive aspect of Dollar Savings Direct is its highly consumer-friendly fee structure. There are no fees associated with opening an account and no monthly maintenance fees of any kind. Additionally, while many online banks begin charging consumers who make more than six deposits/withdraws during any given statement period, Dollar Savings Direct doesn’t go this route. Though there’s little reason to touch the cash stored in savings accounts this often anyway, it’s nice to know that you won’t be punished for doing so!
Lastly, it’s worth mentioning that Dollar Savings Direct accounts are FDIC insured up to $250,000. Whereas investment vehicles such as stocks carry the inherent risk of losing part or all of your principal, cash stored in Dollar Savings Direct accounts will accumulate consistent if somewhat modest gains while offering you peace of mind regarding the state of your hard-earned savings.
Dollar Savings Direct Negatives
First of all, as alluded to early in this Dollar Savings Direct review, the technological side of Dollar Savings Direct leaves quite a bit to be desired. Their website is spartan and there’s no mobile app to speak of, so don’t expect the most cutting-edge digital experience!
Somewhat more substantially, Dollar Savings Direct doesn’t offer the highest of interest rates compared to its competition. Though 1.8% APR is nothing to sneeze at, it’s still significantly lower than some of the more favorable rates offered elsewhere.
Lastly, it’s worth noting that Dollar Savings Direct has a history of lowering (and subsequently raising) interest rates more dramatically than much of its competition. For example, just a few years ago, Dollar Savings Direct offered an interest rate well under 1%! Though the current interest rate is quite favorable, Dollar Savings Direct is well within its rights to drop it in the future–and it’s done so before in the past.
If you’re looking for a no-frills, high-yield savings account to store away some of your extra cash so that it can generate modest, risk-free returns, Dollar Savings Direct offers a relatively attractive option. With no minimum deposit or significant fees, it’s an accessible and easy-to-manage online savings account!
That being said, Dollar Savings Direct is far from the most modern option available when it comes to online banking and significantly higher yields are currently available elsewhere. These are both facts worth considering before you open an account.