Discover savings account

The Good

• Competitive interest rate
• ATM access through Allpoint
• Checking accounts
• $250,000 maximum daily ACH transfer
• No minimum balance or monthly payments
• Known for fantastic customer service

Discover was founded in 1985 as a spinoff of Sears financial services.  Most consumers know them for their credit cards, where they currently have 8.1% of the market, but they also offer personal loans, student loans, home equity loans, and of course, savings accounts.

The Discover high yield savings account offers a competitive interest rate, on par with its competitors like American Express.  The single biggest differentiator is that Discover also offers ATM access to your cash through the Allpoint ATM network (as does competitor, Ally Bank).  These are the ATMs you’ll find in CVS, Walgreens, and many grocery stores.  You can check the Allpoint website to see if an ATM is located near you.  Discover also offers a checking account with a debit card and free checks, so this is beneficial for consumers who want a checking and savings account (and possibly credit card) with the same company.

Other features of the Discover savings account include a $250,000 maximum daily ACH transfer – which is plenty for most people – and ACH connections to up to three other bank accounts.   There are also no minimum balances requires or monthly fees associated with the Discover savings account.

Finally, Discover is well-known for exemplary customer service.  I haven’t tested this out myself, but I’ve spoken to many friends who are very loyal to the Discover brand and have had glowing reviews of their customer service.

The Bad

• Wire transfer fee of $30
• Not the absolute highest interest rate

The Discover savings account does not have any clear weaknesses that would eliminate it as an option for consumers looking to save.  The main difference between this account and the competition is the wire transfer fees.  Discover charges $30 for a wire transfer fee, whereas it is free at some banks (though these banks typically do not offer ATM access or checking accounts).  So if you anticipate doing more than one outgoing wire in a given year, take this into account.

The second factor to consider is that Discover does not have the industry’s absolute highest APR rate.  However, as you’ll see on our side-by-side comparison of the best high yield savings accounts, Discover is competitive.  To put it in perspective, if you were saving $100,000 per year, the difference of 0.05% interest is only going to be about $50….not enough to worry too much about.

The Summary

Discover has one of the most respected brands in the financial industry and take care of their customers.  While I’ve never been a Discover customer, if you have the credit card already, the Discover savings account is a good one to consolidate your finances under one roof.  And it’s a very good all-around option for any savers, especially those who might want to occasionally take some money out at the ATM.