E*Trade gained its popularity by creating an affordable investment solution for technically savvy individuals. The company allowed individuals to self-direct their own retirement plans and do a lot of the work over the internet. Now E*Trade is following suit with many other financial institutions and offering their version of a high-yield savings account, also known as an online savings account. Their product, the “Complete Savings Account” is similar to other high-yield savings accounts, but does it shine above the others?

For quite a while, E*Trade was considered to be a very solid company. It was founded in 1982 by William Porter and Bernard Newcomb. In 1993 it was one of the very first companies that offered online trading services through CompuServe. The company went public in 1996 and has only grown since then. In the last year or so, there has been some serious questions about E*Trade’s financial stability because of some major write-downs of subprime mortgages. Fortunately your money is insured by the FDIC up to $100,000 if E*Trade were to ever go under.

The “complete savings account” has a lot of benefits. E-Trade’s account features exceptionally fast online transfers, and even guarantees that no interest will be lost because of transfer time. In addition, if you have an E-Trade brokerage account, you can transfer money to your brokerage account instantly. This is good if you want to make a purchase in the market and time is of the essence. In addition, ETrade does not perform a hard credit pull so your credit score will not be affected if you open an account with them.

If you have at least $5000 in your savings account, you can get a free linked checking account and a debit card that offers an unlimited number of rebates other bank’s fees. This means you could withdraw money from any ATM without ever paying a fee.

The current interest rate being offered by e*Trade is 3.30%. This is a very decent interest rate in today’s market considering that ING Direct and Emigrant Direct are both offering 3.00%. It’s not the highest interest rate available, but it’s definitely up there.

There are some questions about their customer service overall. From what we can tell, there’s not a separate customer service department for their savings products and there have been some reports of it being hard to get useful, informed support from them. If you are seriously considering opening an account with them, you might want to call up their customer service line and ask a couple of simple questions to see how painful of an experience it is to get help from them.

If you have an ETrade account already, opening one of these accounts makes good sense. It’s a good account with pretty solid features, but there are some slightly better interest rates available elsewhere.

This entry was posted on Wednesday, August 20th, 2008 at 8:43 am and is filed under reviews. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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