Well, I just finished opening the American Express high yield savings account and thought I’d write a review. The entire process was fairly quick when done online. More on that later.
Update: Discover currently offers a better interest rate and better customer service. Click Here to Read our Full Discover Savings Account Review.
I opened the account because I’m tired of earning nothing from my checking/savings account at the local big bank. The AmEx high yield savings account is an excellent option if you need to have access to the money short term. It’s very liquid and withdraws are easy to make.
For all the money that I can’t invest (see reviews of my favorite investment platforms here and here), I’ll park it in the AmEx account. It won’t earn a ton, but the high yield here is really good for no risk and high liquidity. Anyhow, let’s get into my experiences and the review.
American Express High Yield Savings Review
I don’t think American Express needs any introduction, but in case you weren’t sure, they are a long lasting and reputable company. Here is a little background information from Wikipedia:
American Express Company (NYSE: AXP) or AmEx, is an American multinational financial services corporation headquartered in Three World Financial Center, Manhattan, New York City, New York, United States. Founded in 1850, it is one of the 30 components of the Dow Jones Industrial Average. Amex credit cards account for approximately 24% of the total dollar volume of credit card transactions in the US, the highest of any card issuer.
BusinessWeek and Interbrand ranked American Express as the 22nd most valuable brand in the world, estimating the brand to be worth US$14.97 billion. Fortune listed Amex as one of the top 20 Most Admired Companies in the World.
The only point in mentioning this is because it’s a vote of confidence. If I’m going to put a few thousand dollars somewhere, I want to have assurance that it won’t disappear overnight.
In addition to the information above, the American Express High Yield Savings Account is fully protected by the Federal Deposit Insurance Corporation (FDIC).
If you deposit your money and the bank goes under, you’ll be fine – as long as you don’t have more deposited than the FDIC insurance will cover. Currently that amount is $250,000 per depositor.
How It Works
The American Express high yield savings account is completely online. You can’t go to your local bank and sign up or deposit checks. Instead, you have to still posses a local checking account that acts as the intermediate.
You control the cash flow between both account through the easy-to-use online interface. So you can deposit or withdraw money from the local checking account at any time.
By making the account online only, American Express can keep their overhead costs lower, resulting in the increased interest rate payout to customers. In addition, many people end up loving the fact that they can’t spend the money from the online account as rapidly as a local checking account. It results in planned spending.
Why I Chose the AmEx High Yield Savings Account
- Solid Interest Rate. Amex has consistently offered a reasonable rate for an online savings account. This savings account currently pays a rate of interest at 0.90%.
- Convenience. The application process takes only a few minutes if you have all of your personal information ready. It literally took me 5 minutes. You can also choose to have your statements sent to you via postal mail or electronically.
- Automatic Transfers. You can set up an automatic transfer to/from your external checking account, and schedule a direct deposit to your AmEx savings account.
- Support. 24/7 Account Access by phone or web.*
- No Fees. There are no fees to open or maintain your account.
- No Minimums. You only need $1 to open an account, and you don’t have to keep a certain balance. This is in stark contrast to many other online account which require a hefty standing balance.
- Safety. As mentioned above, FDIC insurance and a long standing, reputable company that should be around for a long, long time.
Opening an Account
The process to open my account was extremely easy and quick. Here are the steps you need to take to open a new account:
- Gather and Input Information: They will ask for your Social Security number, address, email, date of birth and existing bank account information if funding your account electronically. You’ll also decide if you want a single or joint account. We chose joint, as a husband and wife.
- Submit your Application: Submit online or by phone anytime at 1-800-446-6307.
- Receive Confirmation: The approval process was automatic for us. It asked me a few questions from my credit history, like what year car I owned and past address. Then I was approved. I also received an e-mail confirming approval.
- Fund your Account: You are required to link a checking account and fund your new American Express high yield savings account with at least $1. This process was extremely easy and quick.
That’s it. These steps literally took me about 5 minutes.
* Note that you may make up to six withdrawals or transfers out of your High-Yield Savings account during a monthly statement cycle. Please see the Amex website for details.
American Express High Yield Savings Account Review Summary
I recommend this savings account if you want an easily accessible investment that will actually pay you some interest. It’s a great addition to a local checking account, and you can easily transfer money between the two.
Don’t let you money sit in checking and earn nothing, open up a High Yield Savings Account today.
Update: Discover currently offers a better rate and we love their customer service. Click Here to Read our Full Discover Savings Account Review.