Where should we park our money?

August 9, 2022 3:10 PM

My husband and I have had an online savings account with DiscoverBank for many years, but now have to change to a different bank. I've been looking at Bankrate and the like, and have simply gotten confused. Can you help navigate us to an online bank which will meet our needs and pay a (relatively) great rate of interest on either a savings account or a money market account? (For comparison purposes, DiscoverBank is currently paying 1.5%.)

Our account at DiscoverBank grows through investment dividends/capital gains which we transfer over from our online brokerage (E*Trade, if it matters), and is reduced through automated monthly transfers to supplement our retirement incomes, as well as large withdrawals for major expenses. We have never had more than two or three withdrawals in a given month and I don't anticipate that changing.

This has all worked very well for us. But we've recently set up a trust for our estate upon our passing, and DiscoverBank will not allow us to designate the trust as a beneficiary, which is a deal-breaker. Our lawyer says he's never encountered that problem with other clients' banks, so I don't expect that to be a limiting factor with New Bank but I will make sure that New Bank will allow a "payable on death" to a trust.

We keep a high enough balance in the online savings account to satisfy any bank's minimum deposit. It would be nice, but not necessary, to have CDs available at the same New Bank. Otherwise, we have no requirements beyond being able to park our money somewhere that pays decent interest and allows us to move it around electronically.

posted by DrGail to Work & Money (9 answers total)

Have you looked into accounts at a local credit union? We have a decent rate for our checking account, but I haven't looked at other vessels lately.
posted by kellyblah at 3:21 PM on August 9, 2022

Since you already have an E*TRADE brokerage account, have you checked if their banking will let you do what you need? Their savings APY is currently 2.0%.
posted by justkevin at 3:40 PM on August 9, 2022

We have a trust set up as beneficiary at our American Express savings account -- currently at 1.4 but it has risen several times in the last couple of months, and I expect it to go higher.
posted by BlahLaLa at 3:48 PM on August 9, 2022

In a different thread Candleman suggested this article in NerdWallet, the Seven Best High-Yield Online Savings Accounts of August 2022, which leads with your DiscoverBank and doesn't list anybody offering more than 1.8%.
posted by Rash at 6:51 PM on August 9, 2022

Ally Bank has been great for us (no experience with a trust), with a 1.6% APY currently
posted by misterbrandt at 9:02 PM on August 9, 2022 [3 favorites]

Ally has also been good for us and we recently changed the name for Account Owners to the name of our Trust with no issues.
posted by gillianr at 9:26 PM on August 9, 2022

I have an American Express savings account and make weekly transfers from it into my Vanguard investment account with no problems. As mentioned above, the rate has recently risen to 1.4% and I get "your rate is going up!" emails regularly these days.

I checked and they also offer CDs but I don't use them.
posted by jabes at 7:03 AM on August 10, 2022

Thirding Ally.
posted by misanthropicsarah at 10:02 AM on August 10, 2022

I love Ally and have been using them for nearly 7 years.
posted by getawaysticks at 7:31 PM on August 10, 2022