Savings accounts are basic banking products that allow you to deposit money to earn some interest in a certain time. While usually they aren’t too profitable, they are considered very safe and stable, so it’s the right kind of investment option to accumulate long-term savings. But now, many financial platforms and online banks offer their users a virtual kind of such accounts that can be managed through mobile devices. In this article, we explain how it works and help you choose the best option suitable for you.
How digital savings work
Virtual accounts work pretty much the same way as the offline ones. You store funds on an account in exchange for a modest amount of interest. However, digital accounts allow you to access your money anywhere you go, and you can also automate regular deposits. Online financial services usually offer higher interest rates to attract customers, but they are just as secure and reliable as traditional banks and funds. But now, you don’t even need to call your bank, just enter an app and manage your funds.
There are also all kinds of useful features in such apps: you can track your deposits and earnings, or you can set your account to pay your bills automatically. It really makes life easier, but of course, this digital model has a couple of disadvantages: for example, depositing cash is much more difficult than with a real bank that has real ATMs everywhere. Anyway, let’s look at the most convenient and useful services that offer a digital savings account as one of their products.
Revolut
This popular British startup has all kinds of digital products, and its Savings Vault is a great option for storing your money. It has decent interest rates, no limits on deposits and withdrawals, and the funds are protected by FSCS. However, Revolut charges extra for ATM cash withdrawals that exceed $300 a month.
SoFi
Another online bank, SoFi features a high-yield savings account that can be divided into subaccounts called Vaults dedicated to certain financial goals. There’s also a mechanism that allows you to deposit small sums from every debit card operation into one of your Vaults.
Varo
Varo is an online banking service with an exceptional savings account. The account has high interest rates, and there are no monthly fees or unnecessary limits on deposits. Moreover, Varo accounts are insured by FDIC.
This article was shared by Ivan Andriyenko.
