{"id":14855,"date":"2025-11-24T03:12:00","date_gmt":"2025-11-24T09:12:00","guid":{"rendered":"https:\/\/www.discover.com\/online-banking\/banking-topics\/?p=14855"},"modified":"2026-02-03T12:26:59","modified_gmt":"2026-02-03T18:26:59","slug":"what-is-an-online-savings-account","status":"publish","type":"post","link":"https:\/\/www.discover.com\/online-banking\/banking-topics\/what-is-an-online-savings-account\/","title":{"rendered":"What is an online savings account?"},"content":{"rendered":"\n<script type=\"application\/ld+json\">\n{\n  \"@context\": \"https:\/\/schema.org\",\n  \"@type\": \"FAQPage\",\n  \"mainEntity\": [{\n    \"@type\": \"Question\",\n    \"name\": \"What is an online savings account?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"A true online savings account is one that exists solely online, with no brick-and-mortar bank branch associated with it. This can mean more mobile banking features, higher interest rates, lower fees, and lower minimum balances than typically come with a traditional savings account.\"\n    }\n  },{\n    \"@type\": \"Question\",\n    \"name\": \"How does an online savings account work?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"Instead of having to find your way to a physical bank branch, Cook says you can typically make a deposit into an online savings account by depositing a check online, through a mobile banking app, or by using an ATM in your online bank\u2019s network. You could also transfer funds from a different existing account.\"\n    }\n  },{\n    \"@type\": \"Question\",\n    \"name\": \"Why should you open an online savings account?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"\u201cThe biggest benefit of opening an online savings account is usually additional interest offered,\u201d Cook says. \u201cCompared to a brick-and-mortar bank, online savings accounts tend to offer at least another 1% of interest, but often even more.\u201d Online savings accounts can typically offer a better deal because they save money by not maintaining physical locations, Cook explains.\"\n    }\n  },{\n    \"@type\": \"Question\",\n    \"name\": \"Is an online savings account FDIC-insured?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"Many online savings accounts offer the same Federal Deposit Insurance Corporation (FDIC) insurance that traditional savings accounts do, according to Cook. It protects up to $250,000 per account holder, per FDIC-insured bank. Cook recommends always confirming that an account is FDIC-insured before you open it.\"\n    }\n  },{\n    \"@type\": \"Question\",\n    \"name\": \"Can you add to an online savings account regularly?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"Cook says you can add to an online savings account regularly (in other words, make a deposit) in a couple of ways: Schedule automatic transfers from a checking account to your online savings account. Ask your employer to send a portion of your paycheck to your online savings account.\"\n    }\n  },{\n    \"@type\": \"Question\",\n    \"name\": \"Can you pay bills from an online savings account?\",\n    \"acceptedAnswer\": {\n      \"@type\": \"Answer\",\n      \"text\": \"You typically can\u2019t easily pay bills from an online savings account. For that, Cook suggests looking into an online checking account. \u201cMost online banks today offer both types of accounts,\u201d Cook says. \u201cThat\u2019s convenient because it allows you to transfer money from your online savings account to your online checking account quickly and pay bills from there.\u201d\"\n    }\n  }]\n}\n<\/script>\n\n\n\n<p>Banking, like so many things we do these days, has largely moved online. With that shift has come an array of online-only banking options, including online savings accounts.<\/p>\n\n\n\n<p>But what is an online savings account? A true online savings account is one that exists solely online, with no brick-and-mortar bank branch associated with it. This can mean more <a href=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/how-to-get-the-most-out-of-mobile-banking\/\" target=\"_blank\" rel=\"noreferrer noopener\">mobile banking features<\/a>, <a href=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/federal-reserve-interest-rate-increase-savings-account\/\" target=\"_blank\" rel=\"noreferrer noopener\">higher interest rates<\/a>, lower fees, and lower minimum balances than typically come with a traditional savings account.<\/p>\n\n\n\n<p>For people who are used to managing most of their lives from their smartphone or computer screen, an online savings account may be a natural fit. It may even offer extra conveniences over a traditional account.<\/p>\n\n\n\n<p>While any given online savings account will have its own features and options, Lindsay Dell Cook, CPA, president and founder of a personal finance and small business consulting firm, can help you understand how online savings accounts work and why they might be useful for certain savings goals.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-how-does-an-online-savings-account-work\">How does an online savings account work?<\/h2>\n\n\n\n<p>Instead of having to find your way to a physical bank branch, Cook says you can typically make a deposit into an online savings account by depositing a check online, through a <a href=\"https:\/\/www.discover.com\/online-banking\/banking-features\/mobile-app\/\" target=\"_blank\" rel=\"noreferrer noopener\">mobile banking app<\/a>, or by using an ATM in your online bank\u2019s network. You could also transfer funds from a different existing account.<\/p>\n\n\n\n<p>If you\u2019re looking to withdraw money out of your savings account, Cook recommends transferring that money to your <a href=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/should-i-choose-a-checking-account-or-savings-account\/\" target=\"_blank\" rel=\"noreferrer noopener\">checking account<\/a>. She notes that your funds may transfer more quickly to an online checking account with the same provider than they would to a checking account with a brick-and-mortar bank. Making ATM withdrawals may also be an option, though they may come with fees you\u2019d rather avoid (like <a href=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/get-cash-without-paying-an-atm-fee-with-these-4-tips\/\" target=\"_blank\" rel=\"noreferrer noopener\">ATM fees<\/a>).<\/p>\n\n\n\n<p>Other than that, most online savings accounts work very similarly to traditional savings accounts. In general, they give you a safe place to stow your money as you save up for emergencies or a future purchase, Cook says.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Why should you open an online savings account?<\/h2>\n\n\n\n<p>\u201cThe biggest benefit of opening an online savings account is usually additional interest offered,\u201d Cook says. \u201cCompared to a brick-and-mortar bank, online savings accounts tend to offer at least another 1% of interest, but often even more.\u201d Online savings accounts can typically offer a better deal because they save money by not maintaining physical locations, Cook explains.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"2560\" height=\"1049\" src=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-01-scaled-e1677607551867.jpg\" alt=\"A woman smiles while reclining in a hammock and looking at her mobile phone, with trees in the background.\" class=\"wp-image-22552\" srcset=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-01-scaled-e1677607551867.jpg 2560w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-01-scaled-e1677607551867-300x123.jpg 300w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-01-scaled-e1677607551867-780x320.jpg 780w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-01-scaled-e1677607551867-768x315.jpg 768w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-01-scaled-e1677607551867-1536x629.jpg 1536w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-01-scaled-e1677607551867-2048x839.jpg 2048w\" sizes=\"auto, (max-width: 2560px) 100vw, 2560px\" \/><\/figure>\n\n\n\n<p><\/p>\n\n\n\n<p>If you\u2019re someone who likes to do everything from your phone or online, online savings accounts can also offer convenience. You can open a savings account online or with your phone without visiting a physical bank location. And mobile apps make it easy to view your balance, make transfers, and even deposit checks.<\/p>\n\n\n\n<p>Because it can sometimes take several business days to transfer money from your online savings account to a checking account, Cook finds online savings accounts particularly useful for money you want to keep at arm\u2019s length. \u201cIt can be a great place to house your <a href=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/emergency-fund\/\" target=\"_blank\" rel=\"noreferrer noopener\">emergency fund<\/a> so you\u2019re not tapping into that account for things that aren\u2019t real emergencies,\u201d Cook says.<\/p>\n\n\n\n<p>Cook also likes online savings accounts for midterm savings goals, which are goals you have for somewhere between three and 10 years in the future. \u201cOnline savings accounts are great for savings you need really secure and liquid, like saving for a home purchase, vacations, or renovations,\u201d she says.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Is an online savings account FDIC-insured?<\/h2>\n\n\n\n<p>Many online savings accounts offer the same <a href=\"https:\/\/www.fdic.gov\/\" target=\"_blank\" rel=\"noreferrer noopener\">Federal Deposit Insurance Corporation<\/a> (FDIC) insurance that traditional savings accounts do, according to Cook. Deposits are insured up to at least $250,000 per depositor, per FDIC-insured bank, per ownership category. Cook recommends always confirming that an account is FDIC-insured before you open it.<\/p>\n\n\n\n<p>An online banking platform may be an FDIC member itself, or it may partner with a member bank to offer FDIC-insured accounts to its customers, Cook says. You will often find an online bank\u2019s FDIC status featured in multiple places on its website.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Can you add to an online savings account regularly?<\/h2>\n\n\n\n<p>Cook says you can add to an online savings account regularly (in other words, make a deposit) in a couple of ways:<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Schedule automatic transfers from a checking account to your online savings account.<\/h3>\n\n\n\n<p>Cook often advises her clients to schedule a certain amount of money to transfer from their checking account to their savings account on each payday if they\u2019re paid on a regular schedule. \u201cThat way, the money is out of your account before you start spending from the paycheck,\u201d she says. &nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Ask your employer to send a portion of your paycheck to your online savings account.<\/h3>\n\n\n\n<p>Cook notes that not all employers offer this convenience, \u201cbut it\u2019s often the option I see clients have the most success with.\u201d She also points out that this savings tactic shouldn\u2019t replace any contributions you are making to your retirement accounts, health savings accounts, or other important accounts.<\/p>\n\n\n\n<p>If you\u2019re transferring money from a checking account at a different bank, Cook says to confirm whether the bank charges a fee for external transfers. \u201cIt may charge a fee, even if the online bank doesn\u2019t,\u201d Cook says. If it does, then regular transfers might not make financial sense until you make a switch to a new bank. &nbsp;<\/p>\n\n\n<\/div>\n\n\n<div class=\"mx-auto block-quote block-quote--yellow-circles bg-fixed bg-center bg-no-repeat bg-cover z-0\">\n    <div class=\"block-quote__glow\"><\/div>\n    <blockquote class=\"post--constrain-large\">\n        <p>&#8220;Online savings accounts are great for savings you need really secure and liquid, like saving for a home purchase, vacations, or renovations.\u201d<\/p>\n                    <footer class=\"block-quote__source\">Lindsay Dell Cook, president and founder of a personal finance and small business consulting firm<\/footer>\n            <\/blockquote>\n<\/div>\n\n\n    <div class=\"post__content\">\n\n\n\n\n<h2 class=\"wp-block-heading\">Can you pay bills from an online savings account?<\/h2>\n\n\n\n<p>You typically can\u2019t easily pay bills from an online savings account. For that, Cook suggests looking into an online checking account. \u201cMost online banks today offer both types of accounts,\u201d Cook says. \u201cThat\u2019s convenient because it allows you to transfer money from your online savings account to your online checking account quickly and pay bills from there.\u201d<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">How do you open an online savings account?<\/h2>\n\n\n\n<p>Similar to <a href=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/opening-a-checking-account-online\/\" target=\"_blank\" rel=\"noreferrer noopener\">opening an online checking account<\/a>, here\u2019s how to open an online savings account in five steps:<\/p>\n\n\n\n\n\n\n<h3 class=\"wp-block-heading\">1. Research your options<\/h3>\n\n\n\n<p>This step may take some time, but it\u2019s important to know that the account you\u2019re opening will actually work for you.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>First, check to ensure that the account is FDIC-insured. If it\u2019s not, find one that is.<\/li>\n\n\n\n<li>Next, look at the fees, minimum balance requirement, interest rate, and rewards if they\u2019re offered. This step will help you compare accounts according to how well they\u2019ll support your savings goals.<\/li>\n\n\n\n<li>See if you can do your banking at nearby no-fee ATMs. Often, online banks have <a href=\"https:\/\/www.discover.com\/online-banking\/#ATMFinder\" target=\"_blank\" rel=\"noreferrer noopener\">ATM networks<\/a> that give their customers another option for deposits and withdrawals.<\/li>\n\n\n\n<li>Look for quality customer service and a well-designed mobile app. Even without a physical location, online banks often offer customer service to answer questions and resolve issues. And make sure the mobile app has the features you need and is easy to navigate.<\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"2470\" height=\"1011\" src=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-02-scaled-e1677607671394.jpg\" alt=\"A man smiles while high-fiving two boys in a backyard, with trees in the background.\" class=\"wp-image-22553\" srcset=\"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-02-scaled-e1677607671394.jpg 2470w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-02-scaled-e1677607671394-300x123.jpg 300w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-02-scaled-e1677607671394-780x319.jpg 780w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-02-scaled-e1677607671394-768x314.jpg 768w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-02-scaled-e1677607671394-1536x629.jpg 1536w, https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-content\/uploads\/2025\/11\/What-is-an-online-savings-account_In-Article-02-scaled-e1677607671394-2048x838.jpg 2048w\" sizes=\"auto, (max-width: 2470px) 100vw, 2470px\" \/><\/figure>\n\n\n\n<p><\/p>\n\n\n\n<h3 class=\"wp-block-heading\">2. Create a profile<\/h3>\n\n\n\n<p>Once you\u2019ve settled on an online bank, you\u2019ll create a profile on the website. Be sure to set a strong password that\u2019s long, unique, and hard to guess.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">3. Enter your personal information<\/h3>\n\n\n\n<p>Expect to complete an application that asks for your identifying information, including your Social Security number and contact information. This is why it\u2019s important to only open an account with a provider you trust.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">4. Select an account type<\/h3>\n\n\n\n<p>After entering your information, you may need to select the type of account you\u2019re trying to open, if you haven\u2019t already. In this case, you\u2019d choose an online savings account.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">5. Fund your account<\/h3>\n\n\n\n<p>The final step is to put some money into your online savings account. If the account comes with a minimum deposit requirement, you\u2019ll have to deposit enough to meet it. This is typically done by transferring funds from an existing account into your new online savings account, which you can do online or from the mobile app.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Open an online savings account today<\/h2>\n\n\n\n<p>Now that you know what an online savings account is, you can see that they offer a number of advantages. They\u2019re typically easy to use, often insured by the FDIC, and offer interest rates that can keep your money growing. All of these features make an online savings account the perfect place to keep your savings.<\/p>\n\n\n\n<p class=\"disclaimer\">Articles may contain information from third parties. The inclusion of such information does not imply an affiliation with the bank or bank sponsorship, endorsement, or verification regarding the third party or information.<\/p>\n\n\n\n<p class=\"disclaimer\">The information provided herein is for informational purposes only and is not intended to be construed as professional advice. Nothing contained in this article shall give rise to, or be construed to give rise to, any obligation or liability whatsoever on the part of Discover, a division of Capital One, N.A., or its affiliates.<\/p>\n\n\n","protected":false},"excerpt":{"rendered":"<p>Curious about online savings accounts? Get familiar with what an online savings account is, how it works, and how you can open one.<\/p>\n","protected":false},"author":15,"featured_media":15029,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[76,77],"tags":[135,37,55,98,131,130,26,25,32,128,39],"class_list":["post-14855","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking101","category-online-savings-account","tag-automatic-transfer","tag-emergency-fund","tag-financial-goals","tag-funds-transfer","tag-high-interest-rate-accounts","tag-long-term-saving","tag-mobile-banking","tag-online-banking","tag-online-savings-account","tag-opening-an-account","tag-saving"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/posts\/14855","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/comments?post=14855"}],"version-history":[{"count":40,"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/posts\/14855\/revisions"}],"predecessor-version":[{"id":22554,"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/posts\/14855\/revisions\/22554"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/media\/15029"}],"wp:attachment":[{"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/media?parent=14855"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/categories?post=14855"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.discover.com\/online-banking\/banking-topics\/wp-json\/wp\/v2\/tags?post=14855"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}