- Discover Bank is usually associated with its credit card
but for those that dig a bit deeper,
there's a great bank to use here too.
Discover offers a wide range
of banking products including checking, savings,
CDs, and more.
In fact, most of the time, Discover Bank is on our list
of the best high-yield savings accounts
and our list of the best money market accounts as well.
They also have a very compelling checking account
and great CDs.
In this video, we'll review what you need to know
about Discover Bank before opening an account.
Hey, everyone.
This is Andy Hill with the College Investor Investing
and Personal Finance for millennials.
If you're new to the channel
and like what you hear, please hit subscribe.
So you're ready when our next video comes out.
If you decide to open an account with Discover Bank,
please use the link
in our video description as it supports this channel.
Thanks. So who is Discover Bank?
Discover Bank is part
of the same company that offers the Discover credit card.
All of the Discover financial products can be accessed
through the primary discover.com domain name
of which Discover Bank is a part of.
So, what do they offer?
Well, for those looking to do all of their banking
in one place, Discover Bank comes pretty close.
While they don't offer mortgages or loans,
they do offer a wide range
of deposit accounts with high yields and rewards.
Let's go through their offerings.
Discover offers their Discover cashback,
debit checking account, which consistently makes our list
of the best free checking accounts.
You can earn 1% cashback on up to $3,000
in debit card purchases each month.
There's no monthly maintenance fee
and you can open an account without depositing anything.
Discover Bank has over 60,000 in-network ATMs.
If you prefer going into a bank branch,
you'll probably be outta luck
as the only branch is located in Delaware.
Discover Bank Checking is about as close to fee free
as you can get.
It doesn't charge a fee
for using its overdraft protection service.
It also never charges a fee for out-of-network ATM usage.
Although the third-party ATM provider may charge a fee.
A $30 fee for sending an outgoing wire
is about the only fee that you could run
into with this account.
While this checking account doesn't pay interest,
the 1% cash back makes up for it.
When you spend $3,000 in a month through debit spending,
you'll earn $30, which means $360 over a year.
Then there's the savings offering as well.
There is a top APY savings account
with no deposit to open.
Interest is compounded daily
and there is no minimum balance required
or a monthly maintenance fee.
They are currently offering a top yielding 4.15% APY
on their savings account, with rates changing daily lately,
it's a smart move to check Discover's website
as this rate might be lower
or higher depending on when you're watching this video.
Also, they have a great bonus when you open
a savings account as well.
You can find all that information
on Discover Bank's link in our video description.
They have a Money Market option too.
This is similar to a checking account
but you can earn interest if you have a high balance.
A $100,000 balance will earn you a higher APY
than the regular account.
Right now, you can earn the following.
If you've got a balance of over $100,000,
you can have 4.1% APY under $100,000, 4.05% APY,
for both checking and money market accounts.
Funds can be transferred to
and from external accounts fee free.
The APY on the checking
and money market accounts can change at any time.
That isn't the case with a CD though.
Speaking of CDs, let's talk about Discover CD option.
Now, we've reached the highest yielding account
where Discover is exceptionally competitive.
They have top yielding CDs.
You'll need a $2,500 minimum opening balance however.
Outgoing wire transfers are 30 bucks and there are penalties
for early withdrawals depending on, when you withdraw funds,
the penalty is based on simple interest
for a certain number of months.
For example, less than one year is three months
of simple interest, and five years to less than seven years
is 18 months of simple interest.
They also have IRA CDs.
These CDs are for retirement accounts.
They have the same maturities and yields as regular CDs.
Withdrawals are based on the type of retirement account
whether it's a Roth IRA or a traditional IRA.
Contributions can be withdrawn
from a Roth anytime without penalty.
For a traditional IRA,
you must wait until age 59 and a half.
You can roll over funds from a another retirement account
into an IRA CD or transfer funds
from another financial institution.
Now, you might be asking, is my money safe
with Discover Bank?
Yes, Discover Bank is a member of the FDIC.
Depositor funds are insured up to $250,000.
Discover also uses bank grade encryption, so in the end,
is Discover Bank worth it?
Yes.
If you're looking for a bank that offers checking
and high yield savings products, Discover Bank has those.
While not a full-service bank, Discover Bank
is under the Discover umbrella, which does offer
many different loan products.
Having an account with Discover Bank means
that you'll already be in their system,
should you wanna loan product or credit card later on.
Discover Bank doesn't have bank branches except in Delaware.
If you need a bank branch, you might wanna look
somewhere else besides Discover Bank.
But given how convenient modern banking is,
that's unlikely to be a deal breaker
for the average customer.
Thanks for hanging out today, everyone.
This is Andy from the College Investor.
We'll see you in the next video.