February 22, 2009 Update: DollarSavingsDirect cuts its savings account rate to 2.65% APY. See how this compares to other top savings and money market rates.
In a rather strange move, Emigrant Bank, the parent company of Emigrant Direct has launched another online direct brand, DollarSavingsDirect. DollarSavings differs slightly from Emigrant Direct and currently has a higher savings rate of 3.75% APY, which is competitive with some of the best savings rates offered by other banks. The minimum balance to open the account is $1,000. Emigrant Direct's American Dream Savings Account offers a 3% APY with a $1 minimum balance. At the moment, the difference in rate and minimum balance seem to be all that seperates the two accounts.
The bank is a seperate division of Emigrant Bank although located at the same location as Emigrant Direct. Its FDIC insurance falls under Emigrant Bank, meaning that an account at Emigrant Direct and DollarSavingsDirect both count towards the FDIC limit.
Accounts can be opened online and funded via an ACH transfer from a personal checking account.
Why has Emigrant Direct started a seperate brand? We called Emigrant with this question but didn't receive a reply. My guess is that Emigrant plans to make significant changes to either Emigrant Direct or DollarSavingsDirect over the next couple of months to differentiate their offer and pursue different markets. It will be interesting to see how this develops.
Comments
Anonymous
October 31, 2008
Although interest is compounded daily this is for accrual purposes only. The total of daily interest accured is then credited to the account at month's end. In the event your account balance is $0 the accrual is gets reset to $0. And as the accrual total is the basis for actual end of month interest crediting, your interest earned will be $0. Lots of banks do this and apparently this is allowed as long as it is in the account disclosure...which it is.
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Anonymous
October 31, 2008
Although interest is compounded daily this is for accrual purposes only. The total of daily interest accured is then credited to the account at month's end. In the event your account balance is $0 the accrual is gets reset to $0. And as the accrual total is the basis for actual end of month interest crediting, your interest earned will be $0. Lots of banks do this and apparently this is allowed as long as it is in the account disclosure...which it is.
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YW
November 02, 2008
To Kerry,
From the account disclosure:
"Interest will be compounded on a daily basis and credited to your Account on the last day of the month provided the account balance is greater than $0.00. "
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David
November 03, 2008
I've had the Emigrant 'dream' account for several years...everything ok with it but now I'm going to go for the higher rate with dollar saving direct.
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Flory
November 03, 2008
Re: no interest paid if balance zero--
An obvious point, but some may not know:
It's common not to pay interest if an account is withdrawn to zero, and usually good practice to consider leaving 5 cents in your account after any withdrawal until all interest collected--
of course if there is a minimum balance requirement you may have to leave enough in the account to avoid a low balance charge or leave enough to pay the low balance charge to get your interest, or sometimes you just have to say good-bye to your last month's interest as a cost of doing business.
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Ant viewer
November 04, 2008
Is the FDIC limits for this DSDirect up to $250K now?
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Ant viewer
November 04, 2008
Found it. Yes, they do.
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Robert
November 08, 2008
I have opened about 5 or 6 on-line savings accounts this past month, and I found Dollar Savings Direct to be the easiest and fastest by far to set up. Their web site is clear and easy to navigate. I've made several transfers from my local bank to them, and everything went smoothly. Thus, very happy with them. Various aggravation with those other on-line banks.
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cash
November 09, 2008
Same here Robert, lets just hope the rate remains at 4% for a while. The DOLLAR Rules!
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Old Bud
November 10, 2008
I've had EmigrantDirect account for a while with their charge card. The credit card is 1.40% back on purchases. I never had a problem with withdrawing funds or communicating with the bank. I love the APY that DollarDirect offers and will apply there too.
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