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Discover Bank (Member FDIC) pays a much better savings rate than most traditional banks. With fewer overhead costs than their brick-and-mortar counterparts, the best online banks often pass savings on to customers through better rates and lower fees — and Discover Bank shines on both counts.
Discover Savings Rates
Discover Bank is an online bank and payment services company headquartered in Chicago. The Discover Online Savings Account – Product Name Only pays Discover Online Savings Account – APY APY (Annual Percentage Yield), which is drastically higher than the average savings account interest rate. There is Discover Online Savings Account – Fees Display and a Discover Online Savings Account – Minimum Deposit minimum deposit, and you’ll earn the same rate regardless of your balance.
Discover Savings Rates Pros and Cons
ProsCons
Competitive interest rate, compounded daily
No monthly service fee
Discover Online Savings Account – Minimum Deposit minimum deposit
Early direct deposit
24/7 customer service in the U.S.
Excellent online and mobile banking tools
No physical branch locations$30 outgoing wire feeNo ATM card (although there is a checking account)
Discover Savings Rates FAQs
Does Discover Bank have a high-yield savings account?
Yes, Discover has a high-yield savings account. A high-yield savings account is an account that online banks and credit unions offer that pays above-average interest rates on deposits. The Discover Online Savings Account – Product Name Only pays Discover Online Savings Account – APY APY, well above the national average.
What is the current interest rate for Discover savings?
The Discover Online Savings Account – Product Name Only currently pays Discover Online Savings Account – APY APY. The average savings rate is only FDIC National Deposit Savings Rates – APY, according to the FDIC.
Does the Discover savings account have a monthly fee?
No, the Discover Online Savings Account – Product Name Only doesn’t have monthly account fees or minimum balance requirements. There are also zero fees for official bank checks, stop payment orders, insufficient funds, or bounced checks. Additionally, Discover doesn’t charge an excess withdrawal fee (some banks charge a fee of about $10 if you make more than six monthly withdrawals from a savings account).
Is it safe to keep money in a Discover savings account?
Yes, Discover Bank is a Member FDIC bank. Deposits held in a Discover Online Savings Account are insured for up to $250,000 per depositor, per account ownership type.
What is the disadvantage of a Discover savings account?
The Discover Online Savings Account – Product Name Only has a lot of perks, but it may not be right for everyone. Discover doesn’t have any physical branches, so you should be comfortable banking online. One disadvantage is that the account doesn’t come with an ATM card. You can withdraw money by transferring it to your Discover Cashback Debit Account – Product Name Only or an external bank account, though the latter option may take a few days. Or withdraw money with a domestic or international wire transfer, or by requesting an official bank check.
How Discover Savings Rates Compare
Discover Online Savings vs. American Express® High Yield Savings Account
The American Express® High Yield Savings Account – Product Name Only (Member FDIC) pays American Express® High Yield Savings Account – APY APY, the same as the American Express High Yield Savings Account.
Neither bank has monthly service fees, excess transaction fees, or minimum opening deposit requirements. Both banks offer 24/7 customer support, a highly rated mobile app, and various banking products, including checking accounts, CDs, credit cards, and personal loans.
One noteworthy distinction pertains to mobile check deposits. With Amex, you can deposit up to six checks totaling $50,000 during any seven-day period, with a limit of $25,000 per check — a flexible limit compared to many online banks. Discover’s online disclosure doesn’t specify limits; however, a customer service representative told us the limits are dynamic and new customers might start with a monthly limit of about $500.
You can’t go wrong with either account in terms of interest rates and fees. Still, Amex may be the better option if you want more flexibility regarding mobile deposits. Otherwise, the decision may come down to your preferences and previous experiences with either bank.
Discover Online Savings vs. Capital One 360 Performance Savings
Capital One 360 is a suite of banking products from Capital One, one of the nation’s largest banks by assets. While Capital One is primarily an online bank, it has physical branches in a handful of states and about 50 cafés (a cross between a bank branch and a coffee shop). Discover is an online-only bank, so it doesn’t have any branch locations.
The Capital One 360 Performance Savings – Product Name Only account offers a Capital One 360 Performance Savings – APY APY on any balance. The interest in Discover’s account compounds daily, while Capital One’s interest compounds monthly. Depending on how much money you keep in savings, this may or may not make a significant difference.
The banks share similar features, including zero monthly and overdraft fees, a Discover Online Savings Account – Minimum Deposit minimum opening deposit, and no requirements to earn the APY. Both banks offer mobile check deposit with dynamic daily and monthly limits. Discover comes out ahead with 24/7 customer service; Capital One has live support seven days per week, but from 8 a.m. to 11 p.m. ET.
Discover and Capital One offer such similar rates, fees, and features that deciding between the two can be tricky. Ultimately, customers who live near a Capital One branch or café might choose it over Discover for the convenience of in-person banking. Discover might be a better fit if you prefer 24/7 customer support.
The bottom line: The best high-yield savings accounts offer competitive interest rates and low fees, and the Discover Online Savings Account – Product Name Only comes with both: You’ll earn Discover Online Savings Account – APY APY while paying zero account fees. The Discover Online Savings Account – Minimum Deposit minimum opening deposit might be especially attractive to new savers who might not meet the higher initial deposits some banks require.
Why You Should Trust Us: How We Reviewed Discover Online Savings
We rate banks on a scale from zero to five stars, with five being the most favorable. For our Discover Online Savings Account – Product Name Only review, we used Insider’s savings account methodology, which considers minimum opening deposits, monthly service fees, interest rates, customer support, mobile app ratings, and the company’s ethics.
When considering whether or not Discover is right for you, consider its additional product lines:
Best Discover Credit CardsDiscover Student Loan ReviewDiscover Personal Loan ReviewDiscover Home Loans Review