MySavings Direct Review - Everything You Need to Know

An online-only bank with competitive interest rates on savings accounts

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MySavings Direct is a division of Emigrant Bank, founded in 1850 by Irish Emigrants and currently has $6 billion in assets. It is an online-only bank offering deposit accounts at a better interest rate than your local brick and mortar bank, and even many online banks.

Who is MySavings Direct Best for?

MySavings Direct will appeal to customers looking for an online-only bank to hold their savings or a CD. It’s perfect for those who:

  • Already have a checking account at another bank
  • Have a larger savings account balance
  • Are looking for a certificate of deposit (CD) with a competitive rate
  • Are comfortable banking at multiple banks
  • Are comfortable with online-only banks

Pros

  • At 2.4% APY, their savings account is more competitive than the national savings account interest rate of 0.32%.

  • Certificates of deposit currently have a promotional rate of 2.4%, which is significantly higher than most banks

  • No fees or service charges

  • No minimum deposit required

Cons

  • You can’t open a checking account, so you’ll need a second bank for your everyday banking needs

  • You might find other online banks offering higher rates on their savings accounts

  • No ATM access or mobile banking app

Types of Accounts

MySavings Direct offers the following types of accounts:

Learn more about each type of account MySavings Direct offers below.

Savings Account

MySavings Direct's MySavings Account is this bank's version of an online high yield savings account. Advantages of this account include:

  • No monthly fees or service charges
  • No minimum balance requirement
  • A highly competitive 2.40% APY
  • No fee for excess monthly withdrawals.

Banking with MySavings Direct will feel very basic. If you’re looking for a fully modern, technology-driven app experience, you won’t get that at MySavings Direct because it has no app. Even their website looks somewhat dated but, fortunately, a savings account isn’t something that requires a lot of maintenance.

To open a Savings Account with MySavings Direct you must be 18 years of age, have a valid tax identification number, a legal address, and an existing personal checking account held at a U.S. bank other than MySavings Direct. Although you can fund your account with a check, the easiest way is through ACH from the bank that holds your checking account. Your first deposit may be by check, but it must be from the same bank that holds your checking account.

After the initial funding, MySavings Direct doesn’t accept direct deposits of your paycheck, in part because you don’t want to be paying your monthly bills out of your savings account. Federal Regulation D limits withdrawals from a savings account to six per month. If you go over six, your bank has the right to charge you a fee for each withdrawal. Some banks charge as much as $15, but MySavings Direct does not charge anything.

MySavings Direct isn’t completely without fees, but the fees are for services most customers will never need. This includes a $100 legal fee for processing subpoenas or levies, $30 for a balance confirmation letter or verification of deposit, and $5 for additional copies of that letter. These are very reasonable fees for services outside of the normal customer service requests.

You can access and manage your money by logging on to MySavings Direct's online banking portal. You can fund your account through a check for the initial opening deposit but after that, you must fund the account using your checking account from another bank. You can also add an additional checking account to fund your MySavings Direct savings account if you would like.

Because MySavings Direct doesn’t offer a checking account, you have to be okay with banking at multiple banks. If you’re looking for a one-stop shop, MySavings Direct isn’t for you.

You won’t get ATM access or a debit card through MySavings Direct either. Although this seems like a big inconvenience on the surface, remember that this isn’t your primary bank. You aren’t paying bills or writing checks out of your savings account, so the lack of an ATM access or any kind of debit card shouldn’t be a deal breaker.

Certificate of Deposit

MySavings Direct’s Certificate of Deposit is for current savings account holders only. Advantages include:

  • Impressive top APY of 2.4% promotional rate for a 6-month CD
  • Minimum deposit of only $1,000
  • Interest compounded daily and credited monthly

Certificates of Deposit are one of the easiest products to shop for because the rules are straightforward—deposit money, let your money sit in the account, collect your interest, redeposit the money once the CD matures. That’s also the case with MySavings Direct.

Keep in mind that the 2.4% APY on their 6-month CD is a promotional rate as of the date of this writing. At any time they could revert back to the normal rate of 1.65% APY for a 60- to 120-month CD or a 30-month CD at 1.3% APY.

All of these accounts have a minimum balance requirement of $1,000 and you can’t withdraw the principal until the maturity date of the CD without paying an early withdrawal penalty. You also can’t add to the principal once you initially fund the account. You will have to wait until the current CD expires or, if you have additional funds of more than $1,000, you can open another CD.

Just like its savings account, MySavings Direct’s CDs are FDIC insured, meaning that the first $250,000 is completely safe.

Purchase of Precious Metals

Although not something you see advertised often, MySavings Direct sells and stores precious metals for its customers through what it calls Precious Metals Direct. In fact, nearly half of its FAQ page is devoted to its precious metals business.

Current MySavings Direct customers can purchase gold bullion bars and coins provided by the United States Mint—a bureau of the Department of the Treasury. Coins are only bullion coins, meaning that they aren’t valued by anything other than weight. These aren’t commemorative coins that may have value based on how many were minted, age, rarity, etc. Bullion coins are just like gold bars.

Because you must have a MySavings Direct Savings Account, you can only purchase precious metals with money from your account. You can view some of their current pricing, but like any precious metals site, prices change with the market.

Along with buying, you may also sell your precious metals at competitive rates. Funds are deposited directly into your MySavings Direct savings account.

Finally, MySavings Direct will store your gold at a rate of .80% of the daily value of your holdings per annum, or you may have it shipped to your door. If you have the funds to order huge quantities of gold bullion, MySavings Direct will even arrange for armored car delivery.

Overall Experience

Remember, the way you interact with MySavings Direct would be much different than your dealings with your checking account bank. Savings accounts and Certificates of Deposits are meant to be left alone to collect interest. All of the perks you would expect from your other bank aren’t necessary at a bank that will only hold savings and CD accounts.

For that reason, it doesn't have much in the way of frills, modern app access, and it doesn't have any physical branches at all.

With that disclaimer in mind, MySavings Direct’s interface does feel like something from the early days of the internet. Their website is extremely bare-bones: No stock imagery, not even a menu. If you’re looking for a great online experience, this is not the place to find one.

However, customer reviews for the bank are generally positive. Although you can find some negative reviews—that’s true of every bank—the majority of people are satisfied with their customer service experiences. Reviewers and customers rightly point out that MySavings Direct is no longer the best deal in online banking. Their rate is still excellent, but other banks with better-known names are offering accounts that pay higher rates. Some of those names include American Express, CapitalOne, Goldman Sachs, Synchrony, and Discover.

Make sure to read the fine print, as some of MySavings Direct’s competitors have other rules, conditions, and fees. But it's no longer assumed that MySavings Direct is the leader in high interest savings accounts and CDs.

About MySavings Direct

MySavings Direct is an online-only bank started in 2008. It’s parent, Emigrant Bank was hit hard during the financial crisis, eventually requiring a bailout. It has since recovered to the point of being a well-capitalized bank.

You can contact them by phone, email, and by mail:

MySavings Direct is FDIC insured, meaning that customers don’t have to worry about losing their funds if the bank were to go out of business.

The Bottom Line

BENEFITS

Unlike other banks that tend to offer incredibly meager interest rates on savings accounts, MySavings Direct’s 2.40% rate is one of the most competitive rates you’ll find, although not the highest. Their Certificates of Deposit are also highly competitive with rates currently at 2.40%.

In a world where people generally don’t trust big banks, largely because of the hefty fees they charge, MySavings Direct stands out for their lack of fees or service charges.

DRAWBACKS

If you’re looking for all the benefits of a traditional banking experience, you’ll find very few of those at MySavings Direct. They have no physical locations, you can’t open a checking account, there are no ATMs to access, no debit card, and they have a very pared-down website experience.

However, for what it offers, it does just fine. You don’t need all the bells and whistles for a savings account and possibly a CD.