- One of the highest APR rates
- 34 physical branches (all in Massachusetts)
- Mutual bank, like a credit union, means decisions are less profit-driven
- Full-service bank offering checking, mortgages, loans, certificates of deposit, etc.
Salem Five has been around since 1855 and has 34 locations, mostly around the greater Boston area. They are headquartered in Salem, Massachusetts….home of witch trials, pilgrims, and now online banking. They came onto the scene a couple of years ago with a high yield savings account, and today, the annual percentage interest rates (APR) is one of the highest in the industry. Like most banks, it is a variable rate so it can change any time. But in an environment where interest rates are steadily increasing, the chances of the rate going down are minimal. For consumers who have cash that they want to park for a while and don’t foresee moving money around much, don’t need to take any out, and don’t need features like wires, Salem Five is a good option.
This is also a traditional bank, so it offers a lot of other services. Many consumers like to keep much of their banking with one company, so this is possible with Salem Five. They do offer mortgages, but take note, they are only licensed to operate in the state of Massachusetts and Maine.
Finally, their customer service is that of a small company. This can be both good and bad. When I spoke to them, I was on hold for about 3 minutes, but then a real person picked up and she was very knowledgeable. For very busy & internet savvy consumers, some of the “digital first” online savings accounts may be ideal. But for those who appreciate the personal touch, Salem Five feels like your small community bank.
- Low ACH transfer amount
- Poor digital and mobile experience
- No notification of when rates change
- Complaints about fees
- No ATM network except its own
Salem Five has online banking, yes, but it’s not going to win any awards. One of my biggest gripes with Salem Five savings accounts is the ACH transfer max. Just $5,000 per day! And only $15,000 per month! Again, if you’re parking money their once and want to forget about it, no big deal. But I often move money around. A $5,000 max just doesn’t cut it, and I also like to have multiple ACH connections to my multiple other banks which isn’t possible. The opening and closing of an account also needs to be done over the phone and with real signatures, which can take a week or two.
Their website is pretty lackluster on information and the mobile app has some of the lowest customer reviews of any banks I looked at. I’d imagine the website login for customers also leaves a bit to be desired. One area I asked about was whether or not customers can sign up to receive an alert when their rate changes. The answer is no.
There are also some current consumers who have complained about ticky-tacky fees. For instance, if you want to receive a paper bill, that is $2.95 per month. Even if you’re just recycling the statement, that’s something you may not even realize you’re paying for a few months. It’s a small fee, but that is just weird to me and not a fee I’ve encountered before.
Finally, Salem Five does have 34 locations with ATMs. If you live in the Boston area, that may work fine for you. If not, there is no network of ATMs that Salem Five is part of, nor is there any reimbursement for ATM fees that you might incur when using the ATM of another bank.
Salem Five is a great option for high savers in the Boston area. For everyone else, they might be ok if you’re going to open the account, put in money, and not touch it for a long time (like years). But for everyone else, the lack of features and poor online experience worries me. I’d recommend going with a savings account that has a slightly lower APR rate but lets you get your money in and out quickly and easily from any device you want.