- For the most part, internet bank accounts are paperless. ING allows you to open an account online in about five minutes. Some banks will have you fax them some signed forms to verify your identity. HSBC will also ask you to provide details of a government-issued identification card, used to verify your identity. After filling out your personal information, you will be asked to link the savings account to an existing checking account. Two small deposits will be made. Once you verify those deposits, your identity has been verified and you can start saving.
- Funds for your online account come from your linked checking account. Some banks allow you to have more than one linked account. Transfers between accounts are usually free. You can also set up an automatic savings plan that allows you to make regular deposits into your online savings account from your linked checking account. Most online savings accounts also do not have fees or penalties attached to them because they are not associated with brick-and-mortar banks, which incur huge overhead costs to carry out their services.
Most internet banking accounts are insured by the Federal Deposit Insurance Corporation (FDIC) just like traditional bank accounts. However, it is prudent to make sure that your account will be FDIC-insured before you open it. Some internet banks allow you to have more than one bank account with them. Bear in mind that the maximum FDIC coverage of $250,000 applies to all the accounts, with a particular bank per depositor. Make sure that your total deposits, regardless of how many accounts you may have with a particular bank, do not exceed $250,000.
- Advertisement -
- Advertisement -