I was keeping all my emergency cash in the new ‘Online savings’. I used accounts such as HSBC Direct, FNBO Direct, ING online…
A couple of years ago, it was a saver’s dream because all these banks were competing against each other for cash. Interest rates were sweet for awhile (~6%). But now they have all dropped their interest payments to below 1.5% probably due to the fact that the Fed is doling out cash for free at 0%.
So the extremely low rate of return was pissing me off. But my real concern that I forgot to mention before was regarding the safety of these ‘Online’ and ‘Direct’ accounts over the internet. Granted they all claim to be FDIC insured, but this is a whole new internet ball game which hasn’t been tested yet.
Any legal eagles out there know of cases involving online internet banking accounts?
