Monday, August 20, 2007

The Online Piggybank

I love Amsterdam. No, I really really mean it. And no, it's not because I nearly went into an artificially induced cardiac arrest one starry night on a bridge over a famous canal, nor is it the culinary delight of a well known brownie, but between Van Gogh and the headquarters of ING there hides a wee bit of love. Van Gogh aside (if you want one you're on the wrong site- perhaps hedge fund blues?), ING is my savings bank of choice.

Banks kill me. They have hidden fees and the most unhelpful people known to those who don't know ConEd. If they didn't have fees when you opened the account (um, hello Commerce Bank...) they sure as hell will eventually. It's like my cash has it's own EZpass. They'll nail you with the fees they forgot to tell you about, like the new minimum to replace the old minimum, and if they do tell you about it they bury it in the fine reading material known as your monthly statement. And their savings account gives you the why-bother interest rate. But everybody needs a checking account and a bank teller, so while the brick and mortar bank is a minor soul suck, it's a necessary one. Commerce is great for waitresses and bartenders and people who drink too much because their business hours are better for people who wake up too damn late to run to the bank before it closes at three. Washington Mutual has no fees, I believe. But for SAVING, I love my bank in Amsterdam.

So here's the new sock & underwear drawer, the freezer, the sigerson morrison box, or whatever place you stash your cash. ING direct gets your ten percent, that minimum percentage of your income that you're saving-remember?And if you send me your email- I'll send you a link to get twenty five bucks when you open an account with at least $250! Like a tradtional bank, ING online bank is FDIC insured. How does it work? You go online and link your ING savings account to your brick and mortar bank checking account. Then you open an account, give it a nickname, like "i got kicked to the curb", and transfer money. You can transfer one time, or even better, on a monthly basis any day of your choosing. Let's say it's the 15th of every month you want to save $100 for that time in the not so distant future your rent goes up and you need another place to live. You set it up online, and like clockwork it will withdraw from your checking, deposit it into your online savings account, and just like that you're increasing you're net worth. You can change the date, cancel the transaction, change the amount, etc. online at any time. It's convenient, and best of all, it's earning you 4.5 percent just for spending too much time on the internet.


d said...

HSBC earns even MORE that ING.
Right now I think it's at 5.05% but has gone up to 6% during promotions.
Another way to set up a forced savings:
open up a brokerage account (like a low to moderate risk mutual fund) and transfer $333 every month (if you can) into that account.
at the end of the year you have your IRA contibution!
just transfer the $$ to a roth or trad. IRA, depending on your needs for that year.

piggybankblues said...

you read my mind! my next post was going to be on IRAs. it's probably best for people who have to invest a little at a time to open an IRA directly with a mutual fund company, say T Rowe Price, and have the funds automatically taken out of your checking account and invested in your retirement fund on a monthly basis. but more on that later...

regarding saving for an emergency fund/rainy day/plain old piggy bank- hsbc, citibank, emigrant direct- they are all great online banks that had/have higher interest rates than ING. when i signed up for ING it was the highest, and i've just grown accustomed to it. it's really just a matter of using what will make saving a habit you don't feel like breaking. just be sure to read the fine print about account requirements, fee structures, and any amount of time it takes to transfer money between accounts.