What is the best internet bank?

That depends on what you’re looking for from an internet banking account. The best internet banks offer high-yield savings accounts with rates that compare well with (and sometimes exceed) rates on CDs from traditional banks, but keep your money accessible. The traditional banks just can’t match internet banks for rates on savings deposits because the traditional banks have more overhead costs to recoup.

With many internet banks offering rates above 5.00%, it makes sense to keep your money in a liquid account. CDs hover around 5.00%, and while they offer the best FDIC-insured return you’ll see at your local bank, they don’t offer the liquidity of a money market account. If you’re looking for better rates than you’ve been getting from your savings account or CD at your traditional bank, why not open an internet banking savings account and grow your money faster?

The best internet banks also provide a simple, intuitive web site that allows you to easily transfer money between it and your local bank. These transfers are free and take around three business days to complete. Two of the better constructed sites are from VirtualBank and ING Direct (check the sidebar for more information about these banks).

You can find objective online bank reviews and online bank comparisons by following the links on this website. There are no fees for opening or maintaining online bank accounts, so you may want to open more than one and keep your money in the best account for you, following the highest interest rates. You don’t need direct deposit to open or maintain an account, but making regular deposits is a great way to grow your money.