Update: On July 14, 2017, American Express Bank increased the rate on its online savings account to 1.15% APY. Keep in mind that these rates can change at any time. Check our high yield savings account page for current rates.
By far, the most requested review on Consumerism Commentary that I have yet to write is for the American Express Personal Savings Account. American Express offers one of the highest interest rates available with this savings account, making it very attractive from the surface. Once you own an account, how does it hold up against ING Direct, Discover Bank, Zions Bank, and the rest of the online savings account portfolio? I opened an account to find out.
First of all, if the bulk of your savings is earning less than 0.5% APY at the local branch of your national brick and mortar bank, it’s time to change. There is usually no excuse for settling for interest rates that low when it’s simple and easy to double or triple the interest you receive in your account every month. Granted, this might not add up to a lot of money, but high yield savings accounts help to ensure your cash will at least hold its value when up against inflation. Your money loses value over time when setting in a low-interest or no-interest account.
Banking Deal: Earn 1.20% APY on an FDIC-insured savings account at Barclays.
After visiting the American Express website to apply for a new savings account, I was immediately impressed with the way the company outlined and prepared me for the application process. You can zoom in on the overview screen by clicking on the image included here.
The first step of the application process, after gathering the materials you need such as your checkbook, driver’s license, and Social Security number, is entering your personal information. If you have an American Express savings account currently, you can easily link your current account to the application.
As I do not have a savings account with AmEx, I entered my personal information. Following this, I entered the amount I intend to deposit from my external bank account. There is no minimum deposit, and I decided to start with $500. While there is an option to send a check, I chose to pull the funds from an existing bank account via an electronic transfer (ACH). After confirming my personal information and deposit amount, I agreed to the standard terms of service and entered my external banking information (routing number and account number). I chose to link this account to my personal Wells Fargo brick and mortar checking account.
The strength of American Express, in this first impression, is the bank’s professional appearance. Each step through this process, the bank’s website was very helpful in letting me know what to expect and when to expect it. When I confirmed my external banking information, it was clear that I would need to verify two test deposits into my newly-linked Wells Fargo account. I immediately received an email with instructions for verifying the test deposits, and I received a welcome kit in the mail in [three] days. It took three days, from Friday to Monday, for the deposits to hit my Wells Fargo account.
After the weekend, I checked my Wells Fargo account and saw two small test deposits from American Express. Once again, AmEx outlined the process clearly, as you can see from the image here. To finalize the link between my new American Express account and my existing checking account at Wells Fargo, the bank required me to enter my email address, a verification code that was sent to me via email, and the amounts of the two test deposits.
After the confirmation, American Express allowed me to create an online user identity for viewing statements and otherwise operating my new bank account. User names for the American Express Personal Savings Account require at least two numerals, so I was unfortunately forced to use a non-standard user ID. For the first time, I chose to receive online statements in lieu of paper statements. This is a trend I want to continue; I receive too much paper in the mail, and electronic states — when chosen without paper statements — will help reduce my clutter, as well as on a small scale, help the environment.
Using the account
As of today, I am waiting for my initial deposit to reach my new American Express savings account. Although there is not much I can do, I am able to look at all features contained in the website and get a feel for its operation. My first order of business was customizing the account names. I also looked at the options for downloading activity into applications like Quicken. American Express supports Quicken through the “Web Connect” service as well as Microsoft Money. There are options for QIF and CSV downloads, too.
There are not many different things you can do with this savings account. Although the bank recently lowered the interest rate offered on these accounts, the rates are still comparatively high. The deposits at American Express Bank are fully insured by FDIC, which means there is no risk in depositing your money up to the FDIC maximum, currently $250,000 for an individual savings account. American Express does not currently offer a checking, bill-payment, or other “transactional” account, so this type of service is fine for letting the cash you need to sit and grow, losing as little value to inflation as possible in a savings account.
|American Express Bank|
|Routing (ABA) number||124085066|
|Established||December 1, 2000|
|Location||4315 South 2700 West, Salt Lake City, Utah 84184|
|Direct Connect||Not supported|
Editorial Note: This content is not provided by American Express. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by American Express.
Updated July 16, 2017 and originally published March 7, 2011.