MySavingsDirect (MSD) added 5 bps to its MySavings Account (2.40% APY) yesterday. This is the second rate increase since MSD became a rate leader in early September, and a good indication that Emigrant Bank (the parent of MSD) is intent on keeping the MySavings Account at or near rate leader status.
Emigrant Bank’s other internet bank, DollarSavingsDirect (DSD), became a savings account rate leader in April 2017. Six rate hikes over the next ten months allowed DSD to continue as a rate leader, but the rate hikes ended in February of this year. The DSD Savings Account 1.80% APY has plateaued since February, while other savings account rates have continued to rise. At this point, the 1.80% APY is definitely on the low side for online savings account rates.
The MSD MySavings Account could follow a similar “Peloton” scenario, with the rate peaking at some point next year, and then being surpassed by other online savings account rates. Nonetheless, MSD can still be a good deal for those who realize it probably won’t be a good savings account in the long run.
ACH Transfer System
As I noted in a November 2014 blog, MSD’s ACH transfer service has been a deal killer for several DA readers. MSD’s FAQ page contains a great deal of information about the MySavings Account, including:
- No sooner than 60 days after the MySavings Account is established, a second checking account may be linked to MySavingsDirect.
- Account Verification Authorization Form must accompany the voided check in order for us to process your request. Faxes will not be accepted.
- Opening deposit can be made by check, but must be from the linked funding account listed on the online application.
- Only external ACH deposits are allowed following the opening deposit.
- A single beneficiary (Social Security number required) can be added, using the online application.
After speaking with an MSD CSR and reviewing my earlier blog posts on Emigrant Bank and its various divisions, I was surprised to see that not much has changed over the past several years. All the ACH details I mentioned in a 2013 blog post are still in effect today. In fact, these attributes are the same that existed when I first wrote about DSD in 2008. And if memory serves me right, I think EmigrantDirect listed the same features when it began in 2005. Rather than doing a rewrite, I’m just going to quote my November 2013 blog post.
No ACH withdrawals initiated by another bank. External ACH deposits are allowed (CSR). Maximum of 2 linked accounts which includes the initial funding account (Q&A). Establishing second linked account requires mailing in a voided check and form (Q&A). Maximum amount that can be transferred via ACH (in/out) is $500,000 (CSR). Linked accounts can only be personal checking accounts (Q&A).
Here’s some good ACH news - transfers are fast, with customers reporting ACH transfers that only take one business day to complete. On the other hand, there is a five business day hold time for ACH deposits.
Some Useful Features
MSD allows customers to open multiple savings accounts; CSR said at least 10 were allowed. MSD’s online account management software makes it easy to transfer between the savings accounts. The software also allows customers to designate a separate beneficiary for each savings account. These features make insuring deposits over $250k fairly simple, with this MySavingsDirect document illustrating how this can be accomplished.
If you want to ensure the vast majority of your savings goes to just one beneficiary and still insure over $250k, this can also easily be done. Please refer to my blog post Maximizing Your FDIC Coverage with Beneficiaries.
Like all of Emigrant Bank’s internet banks, MSD’s withdrawal options are limited: an ACH transfer to an external linked checking account can be initiated using MSD’s online banking system. According to CSR, only two external checking accounts can be linked to a MySavings Account, and the linking of the second checking account requires an additional form and a voided check. I thought having multiple MSD savings accounts might be a way around that restriction, but CSR stated that no matter how many accounts you have, you are still limited to only two linked external checking accounts.
As an online division of New York City's Emigrant Bank, MySavingsDirect has no brick-and-mortar branches and any account with MySavingsDirect must be opened online.
As stated on the FAQ page, opening a MySavings Account “is quick, easy and convenient.”
Just click on the Open Now button on our home page. The only requirements are that you are at least 18 years old, have a valid tax identification number, a legal address and a personal checking account in a US bank. If you still have questions, please call Customer Service at 877-752-1919.
About eight years ago, the Milstein Family (owners of Emigrant Bank) sold 30 of its 32 branches to Apple Bank for Savings. The remaining two branches are located in New York City and Ossining (Westchester County).
MySavingsDirect (along with EmigrantDirect.com and DollarSavingsDirect) is an internet division of Emigrant Bank, and operates under Emigrant Bank’s FDIC Certificate and shares its financial history.
MySavingsDirect/Emigrant Bank has an overall health rating of "B" at DepositAccounts.com, with a Texas Ratio of 19.34% (above average), based on September 30, 2018 data. The Bank has excellent capitalization level (21.44%), the result of holding $5.68 million in assets with $1.22 billion in equity. Please refer to our financial overview of MySavingsDirect/Emigrant Bank (FDIC Certificate # 12054) for more details.
As MySavingsDirect, EmigrantDirect.com, and DollarSavingsDirect are all online banking divisions of Emigrant Bank,
any deposits you have at Emigrant Bank, EmigrantDirect.com, DollarSavingsDirect or MySavingsDirect are aggregated and FDIC insured up to $250,000 per depositor. Keep in mind that individual and joint accounts are insured separately, so if you have both types of accounts with us, your total deposits can be insured up to $500,000; that's up to $250,000 in all of your individual accounts, and up to an additional $250,000 in all of your joint accounts.
Launched in November 2013, MySavingsDirect is the third online banking division created by Emigrant Bank. Emigrant Bank was founded by 18 members of the Irish Emigrant Society in 1850 as a mutual savings bank. By the 1920s, it had grown to become the largest savings bank in the nation. In support of its “hometown,” the Bank invested substantial funds into the New York City community, underwriting constructions loans for Saint Patrick’s Cathedral and a public works project that later became Central Park. Emigrant Bank is currently New York’s 18th largest bank with assets in excess of $6.16 billion, and is also the largest privately owned bank in the country.
How the MySavings Account Compares
When compared to 207 personal savings accounts tracked by DepositAccounts.com that require a similar minimum deposit and are available nationally, the MySavingsDirect MySavings Account APY currently ranks first.
The above rates are accurate as of 12/5/2018.
To search for the best savings accounts rates, either nationwide or in your state, please refer to the Savings Rates section of DepositAccounts.com.