[Nancy]

Do you have information?

[Tony]

Just checked one branch of our bank pays 115,500
in property taxes a year yikes.

[Katie]

no brick and mortar overhead expenses?

[Bruce]

Actually, our savings account at PNC has bumped up to Ally levels in the past couple of months.

[Chris]

Because they don’t have to. Online banks have to compete on interest rates because there’s really nothing else (except maybe customer service). The banking industry is so regulated there really is nothing else to set them apart.

A local bank will always have local people with their passbook savings accounts to whom online banking is just out of the question.

[Nathan]

Just keep in mind that sometimes when banks pay more for deposits, it could be for a reason, they NEED them! A more established bank may not need to pay high interest rates because they are balanced. Just food for thought.

[Cierra]

I did some digging into this last week – what I found was that:

1: Banks can give more interest when they have more income coming in from loan interest. So the banks that lend higher amounts and the most quantities at higher interest rates – can also “give back” more in interest to their savings and investment accounts.

2: As mentioned above – they have some less overhead expenses because they can operate without as many operational costs as a smaller local bank. Yes, the big banks might have headquarters, locations and physical services… but the ratio of expenses to customers served is much greater than that of a smaller bank.

It’s a bummer though because I would much prefer my HYSA emergency fund to be kept at a local credit union.

[Cheryl]

I just opened my So Fi account last weekend! I have a debit card and they let me set up a transfer link between my regular banks so easy access if I need the funds.

[Author]

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