Photo by Dean Drobo / Shutterstock.com
Have you been frustrated by how very little you get in return for keeping your money in the bank? You’re not alone. Even though interest rates are beginning to rise, most of us still get next to nothing on our bank savings accounts.
That’s why you should consider online alternatives for your savings. Enter CIT Bank, a leading commercial finance company that is now offering online consumer banking featuring high-yield savings accounts.
CIT Bank — called BankonCIT.com online– is offering interest rates several times higher than the national average.
CIT Bank is part of CIT Group. Southern Californians may know the company’s bank with brick-and-mortar branches, OneWest Bank, based in Pasadena.
The company has a long track record for helping drive innovation in lending to small- and medium-size businesses, especially retail, energy, health care, transportation and technology companies.
“Now CIT Bank is putting this experience to work for you,” the company says.
Higher savings-account rates
Here’s how it works: Open a tiered interest rate account with a $100 minimum deposit and receive upper-tier interest as an introductory offer. You can keep earning the introductory rate by either maintaining a minimum balance of $25,000 or making a monthly deposit of $100 or more. There are no account-opening or maintenance fees.
The difference in earnings over time is significant: For example, if you open your account with just $100 and make a $100 deposit each month, you can earn 2.15 percent on your savings, compared with the 0.01 percent offered by some traditional savings accounts. At the end of 10 years of monthly $100 deposits, you will have nearly $13,500 in this account, including $1,500 earned in interest, compared with just $12,100 making equal deposits into the lower-yield account, and earning only $100 in interest.
But don’t stop there. If you have some money in checking or savings that isn’t earning for you and you don’t need to have instant access to it — or if you want to move some money from the stock market to a safer investment — consider some other FDIC-insured savings options from CIT Bank.
Other safe ways to grow savings faster
Often described as a hybrid between a checking account and savings account, a money market account generally pays more interest than regular savings but limits access to your funds. CIT offers a money market account with these handy features:
- Minimum deposit of just $100
- Six transfers or withdrawals per statement cycle
- No account-opening or monthly service fees
- People Pay transactions — a free service that allows you to send money from your money market account to almost anyone with an email address or mobile phone number
If you can afford to tie up your money for at least six months in a certificate of deposit, this is another FDIC-insured way to make more interest than a typical savings account. CIT offers these features on CDs:
- Terms ranging from six months to five years
- Minimum deposit of $1,000
- No account-opening or maintenance fees
Interest rates on CDs vary depending on your needs. You can also choose from no-penalty CDs that let you withdraw your money penalty-free before the term is up, high-yield savings accounts or jumbo accounts that pay higher rates on larger deposits.
Different accounts to meet different goals
Why, you may wonder, do you need more than one savings account?
“Setting up in individual savings accounts for short- and long-term savings goals makes smart sense because the reasons for savings vary,” CIT Bank says. “Are you saving for a house, creating an emergency fund or putting money aside for your kid’s college tuition? Keeping accounts separate makes it easier to track savings growth. When you tap your funds, you won’t derail other savings goals.”
As an online bank customer you won’t have bank branches to visit, nor any CIT Bank ATMs, nor a CIT Bank checking account.
Instead you can manage your accounts from your computer — view and download statements and account activity, schedule and make transfers to and from other banks, schedule and make transfers between CIT Bank accounts, create banking reports, open new accounts, receive and manage account alerts and send secure messages.
CIT Bank’s mobile app lets you check account balances and transaction history, transfer money between CIT Bank accounts and, if you’re a high-yield savings customer, deposit checks.
You can also use the bank’s automated telephone banking system or call its customer service center.
The easiest way make deposits to your new CIT Bank account is to transfer funds electronically from your other bank accounts. You can also mail a check or wire the money. Similar procedures apply to withdrawals, but some accounts have rules about how often you may tap in electronically.
What’s your impression or experience of online banks? Share with us in comments below or on our Facebook page.
Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.