Do you use online- only banks?

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PNWhappy
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Do you use online- only banks?

Post by PNWhappy »

I was recently reading a topic in this forum with links to articles about online bank CDs---high yield CDs at Ally bank. I have a sum of cash from a recent sale of land with which I haven't quite decided what to do, and was interested in these CDs. I might be hopelessly old-fashioned, but the idea of an online bank sort of scares me. These are really legit and you guys use them? Thanks for the feedback.
jon-nyc
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Post by jon-nyc »

I use one, but its associated with a brick-and-mortar bank. (DollarSavingsDirect, associated with Emigrant Savings)
digit8
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Post by digit8 »

The "name" banks (ING, for example) are as legit as brick-and-mortar stuff(for what it's worth, these days). I don't use them myself, for the simple fact that I'm borderline Luddite and still like waiting in line and looking someone in the eye while discussing my accounts with them. I don't see the two as very different, from a security/soundness perspective, though.
KyleAAA
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Post by KyleAAA »

Online banks are quite possibly safer than brick-and-mortar banks.
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nisiprius
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Post by nisiprius »

As far as I can tell, I still need a regular bank. The "online bank" is basically just a set of accounts with the ability to move money back and forth between it and your regular bank.

The online banks are obviously doing cream-skimming but that's the banks' problem, not mine.

I have two regular banks and an account at ING Direct.
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Toons
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Post by Toons »

One local bank no interest free checking account, Ing Electric Orange :D :D
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grberry
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Post by grberry »

I suppose technically my bank isn't online-only, because I think it has 1 branch somewhere in Texas. But since I live in Massachusetts, it might as well be. Even physical bank branches are connected online to the big computers at corporate...
AndroAsc
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Post by AndroAsc »

I only do business with online banks. Why wouldn't you? With online banks you get:
1) No fees
2) No min balance crap
3) 24/7 customer service
4) Much higher interest rates
5) Free checks
6) Deposit checks by scanning and sending (woot!)
7) ATM withdrawal from any ATM machine with reimbursement for fees
8) Better stability, no online bank have closed shop in the 2008 crisis
9) Free ACH (yes some B&M banks do charge for this!!!)
10) Ability to create sub-accounts
11) Get to speak to a local customer service rep and not some outsourced personnel halfway across the globe

I only keep one brick and mortar bank to get coins. It has $100 and nothing more.
jsnbrnd
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Re: Do you use online- only banks?

Post by jsnbrnd »

PNWhappy wrote:I was recently reading a topic in this forum with links to articles about online bank CDs---high yield CDs at Ally bank. I have a sum of cash from a recent sale of land with which I haven't quite decided what to do, and was interested in these CDs. I might be hopelessly old-fashioned, but the idea of an online bank sort of scares me. These are really legit and you guys use them? Thanks for the feedback.
I use Ally for CDs. Their rates are better and you can reach a US-based rep on the phone at any time 24/7. I actually set up CDs over the phone and arrange an electronic transfer of funds to them.
TheEternalVortex
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Post by TheEternalVortex »

Apart from the reasons mentioned, I like online banks because they usually let you do everything online. You don't have to go anywhere or call anyone. It's much faster and easier.
GammaPoint
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Post by GammaPoint »

I use local B&M banks just to cash the occasional check (although I could send them off to the online bank if I wanted to), but most of our cash/CDs are at Ally.
rallyfan28
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Post by rallyfan28 »

I have both. Local Brick & Mortar with smaller deposits for when I need it, online for better rates. All are FDIC insured, so I don't see a bigger risk with online. But maybe someone here knows otherwise? Also, even with my local bank, I do most of my business online. Also, since you specifically mentioned Ally, I have a couple of CDs there. My experience so far has been just fine.
Sidney
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Post by Sidney »

shifting to online bank for all regular banking needs. Will probably hold a small account or CD at one of the local banks and have safe deposit box there as well.
I always wanted to be a procrastinator.
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RaleighStClaire
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Post by RaleighStClaire »

I use Schwab for all my banking needs and I love them. I have my investment and retirement accounts at Schwab as well as my credit card so it's all linked up really nicely on one page. I have almost no need for cash and can always mail them a check very easily if need be.
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Live Free or Diehard
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Post by Live Free or Diehard »

AndroAsc wrote:8) Better stability, no online bank have closed shop in the 2008 crisis
NetBank did get liquidated by FDIC and filed for bankruptcy; but it was September of 2007. That was when I started banking with ING Direct.
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simplesimon
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Post by simplesimon »

Similar to another poster above, my "online" bank is Alliant CU. I've never stepped foot in one and the closest branch is about 40 miles from my house but I have a checking, savings, and certificate account with them.
GDBryan
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Post by GDBryan »

I use USAA which now takes deposits at the UPS store.
jpark1982
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Post by jpark1982 »

No online banks for me. I did so a few years ago but ended up with so many different accounts that it just wasn't worth the trouble for me.
Dandy
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Post by Dandy »

I use 2 online banks, Ally and Discover for better rates. I have a brick and motor bank where my pension is deposited into a checking account. This allows me to move money between the banks and Vanguard rather easily.

The online banks are FDIC insured so your money should be safe as a regular bank. But, it is a comfort to have a brick and mortor bank locally so you can meet someone face to face if you have problems. Note: the 24/7 telephone support for Ally and Discover Banks have been great.
ftobin
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Post by ftobin »

I've been using First Internet Bank https://www.firstib.com/ as my sole bank for about 12 years. It was one of the first online-only banks. Free bill payment, decent interest rates, and average fees. I have never really felt a need to look further.

I briefly had a backup account at Bank of America but the terms changed on me without my realizing regarding the minimum balance and I paying $20 in fees on a $20 balance before I closed my account.
Beantown85
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Post by Beantown85 »

I use an online bank for 99% of everything. I still have a checking account at a brick and mortar bank, and the only thing I have used them for recently is tranferring money there to write a bank check.
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PNWhappy
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Post by PNWhappy »

Thanks for the feedback.
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Sunny Sarkar
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Post by Sunny Sarkar »

Online only bank: I used NetBank since around 1999-2000 exclusively for about 3-4 years.

No bank: Then I switched to using a Fidelity brokerage account for banking for another 3-4 years.

Brick & Mortar bank: Now I use Citibank because they pay me approx $10/month to use their checking account - otherwise I'd still be using the Fidelity account.
"Buy-and-hold, long-term, all-market-index strategies, implemented at rock-bottom cost, are the surest of all routes to the accumulation of wealth" - John C. Bogle
jmg229
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Post by jmg229 »

I am an online bank only person. USAA and ING. ING for the rates, lack of fees, and the savings sub-accounts. USAA for the depositing by scan/iPhone/Android (they also had a rewards debit program last I checked, but that may be going away now). The customer service is amazing, where ING gives you a real person immediately, even before sending you through a computer to verify information. The culture of the banks is also a lot better, for what that is worth. I actually enjoy hearing from ING most of the time, and how many people can say that about their bank? I have looked at the Ally CDs and will probably be moving some of our E-Fund into them shortly.
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nisiprius
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Post by nisiprius »

jmg229 wrote:I am an online bank only person.
How do you deal with the occasional need for written checks, teller's checks, certified checks, medallion signature guarantees, etc.?
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
i<3Investing
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Post by i<3Investing »

I use ING direct for my emergency fund.. I've never been worried about it.

It also takes me 3 days to get my money which can be a fantastic deterrent at times.
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Sunny Sarkar
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Post by Sunny Sarkar »

AndroAsc wrote:8 ) Better stability, no online bank have closed shop in the 2008 crisis
Not true... http://www.fdic.gov/bank/individual/failed/netbank.html
"Buy-and-hold, long-term, all-market-index strategies, implemented at rock-bottom cost, are the surest of all routes to the accumulation of wealth" - John C. Bogle
Howie
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Post by Howie »

Toons wrote:One local bank no interest free checking account, Ing Electric Orange :D :D
Couldn't have said it better (or differently!) myself...
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interplanetjanet
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Post by interplanetjanet »

nisiprius wrote:How do you deal with the occasional need for written checks, teller's checks, certified checks, medallion signature guarantees, etc.?
I use an online bank (USAA) for most of my banking needs - I can have a certified check express mailed to me for a modest fee. Written checks are no different than with any other bank and deposits are easy.

I'm not quite online-only, I keep an account open at a regional bank that's slightly over a hundred years old and has resisted the trend to act like a big bank. They charge very few fees and none just to have an account open with them. I think I've only found myself going in there in person once in the last year, though. I suppose they would come in handy if I sold a car for cash and needed to deposit it.

-Janet
gbarquero
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Post by gbarquero »

I do a combination of both type of banks. I have half of my E-Fund at my local Capital One, and use this bank to deposit checks or get large amounts of cash. I use ING for the other half of my E-Fund and most of my expenses, bill payment and transfers to Vanguard. I wish they could start taking deposits using my iphone like Chase and other banks do.
sketchy9
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Post by sketchy9 »

Live Free or Diehard wrote:
AndroAsc wrote:8) Better stability, no online bank have closed shop in the 2008 crisis
NetBank did get liquidated by FDIC and filed for bankruptcy; but it was September of 2007. That was when I started banking with ING Direct.
I miss NetBank! That was a good bank, one of the first online-only banks. They had bill presentment years before anyone else. And they didn't charge international transaction fees. I'm starting to see why they folded....

-R
leod
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Post by leod »

i use online and local bank. i have ING and BAC since they have branch everywhere for emergencies and i travel from time to time.
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Sunny Sarkar
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Post by Sunny Sarkar »

sketchy9 wrote:
Live Free or Diehard wrote:
AndroAsc wrote:8) Better stability, no online bank have closed shop in the 2008 crisis
NetBank did get liquidated by FDIC and filed for bankruptcy; but it was September of 2007. That was when I started banking with ING Direct.
I miss NetBank! That was a good bank, one of the first online-only banks. They had bill presentment years before anyone else. And they didn't charge international transaction fees. I'm starting to see why they folded....

-R
Yes, I miss them too. They were a pioneer in online banking. I live half my life on the internet, so it was such a natural fit for me. Those days I even ordered groceries online.
"Buy-and-hold, long-term, all-market-index strategies, implemented at rock-bottom cost, are the surest of all routes to the accumulation of wealth" - John C. Bogle
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Post by ncaraway »

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natureexplorer
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Post by natureexplorer »

Having an account with a B&M bank can come in handy. I also use online-only banks.
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bish0p
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Post by bish0p »

I use a credit union and online bank.
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beyou
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Post by beyou »

nisiprius wrote:
jmg229 wrote:I am an online bank only person.
How do you deal with the occasional need for written checks, teller's checks, certified checks, medallion signature guarantees, etc.?
Certified etc checks, my online bank will overnight them to me if urgent.

Sig guarantees...got my last one at a local branch bank, and they didn't
even check to see if I had an account there. Public service I guess.
Not all banks will do it, but clearly some will as it's not a law you must
have an account there.

I use www.firstib.com
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Post by billjohnson »

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joe8d
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Post by joe8d »

I use a B&M bank for my checking which entails my direct deposits,auto bill paying and debit card purchases. My savings is with Ally Bank's online savings/ CDs.
All the Best, | Joe
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