If you’re tired of your bank hitting you with fees for nearly everything you do, then paying you a microscopic amount of interest to keep your money on deposit with them, you may have a viable alternative.
EverBank is an alternative to traditional banks if you’re looking to avoid excessive fees while also earning above average interest rates.
Alternative to traditional banks
EverBank is an “online bank”, which is to say that you can conduct all of your banking online without ever having the need to go into the bank itself.
It’s based in Jacksonville, Florida, has well over $13 billion in assets, and has been around since 1961 though obviously not in its online form.
The bank offers 24/7 customer service (by phone), and since it is a bank, your depository assets are covered under FDIC for up to $250,000.
As part of its online model, you can deposit checks from your home computer—all you need to do is add the deposit information into your account online, endorse and scan both sides of the check, and your funds will be available the next business day.
You can also issue checks online. By completing the applicable payment page, you can have payments sent directly into a vendors account, or have a check mailed to the vendor directly. You never actually need to physically write out the check or pay the postage for delivery.
Even though EverBank is known as an online bank, it still offers the full range of bank services including mortgages, savings accounts, certificates of deposit, and credit cards as well as business and brokerage services.
Yield Pledge Checking and Money Market accounts
EverBank offers a “Yield Pledge” on checking and money market accounts insuring that you’ll always be near the very top of the interest rate yield curve.
According to their website, “your rate will always be in the top 5% of competitive accounts offered by leading banks”. By “leading banks”, they mean the banks that appear in the Bankrate Monitor on the last Wednesday of each month.
You need a minimum $1,500 to open an account, but there is no minimum once you do.
Yield Pledge Checking accounts
EverBank is currently paying 1.25% as a six month bonus rate on checking accounts of any size, which is an outstanding return. Rates drop after the initial period, but the ongoing rates are still higher than what other major banks are paying.
One thing to be aware of, while the six month bonus rate doesn’t depend on the size of your account balance, the ongoing rate that will apply afterward does. There are five tiers, ranging from below $10,000, to $100,000 and above, and each has its own rate level.
Rates for the highest account balances are nearly twice that of the lowest.
Check out EverBank Yield Pledge Checking for yourself.
Yield Pledge Money Market accounts
EverBank is currently offering the six month bonus rate on money market accounts too, but only on balances up to $50,000. On balances above that amount the ongoing rate applies, but even that rate is well above that which is being paid by other banks.
Low bank fees
There’s good and bad news here. On the Yield Pledge Checking account, there are no fees for monthly account maintenance, overdraft protection credit lines, or for overdraft protection money market transfers. But there’s an optional online bill payment feature that’s free if your average daily balance is above $5,000; if not, there’s an $8.95 fee. In addition, there is a $25 charge for late payments on an overdraft protection credit line.
Those fees, in general, are lower than what you’d pay at other banks, but if you keep a balance below $5,000 and you use online bill payments—as many people with checking accounts do these days—an EverBank checking account may not be the best place for you.
Here’s a great feature: EverBank will automatically reimburse ATM fees charged by non-EverBank ATMs, and there is no fee for this privilege as long as your average daily balance is above $5,000.
On the Yield Pledge Money Market account, there is an $8.95 monthly fee in any month when average daily balance is below $5,000. You are also limited to six withdrawals/transfers per month (which is standard on money market accounts everywhere), after which they can impose a fee of $10 per excess transaction.
Is EverBank worth it?
If you can maintain an average monthly balance of at least $5,000, the combination of high interest rate returns and low banking fees are hard to beat.
EverBank is the place for you.
Who might not like EverBank? If you’re not able to maintain the $5,000 minimum balance you might have to compare fees with what you’re paying at your current bank. Even then the fee schedule at EverBank is lower than it is at typical local banks. The interest you’ll earn however will almost certainly exceed what your local bank can provide and that has to be considered too.
You also might avoid it if you aren’t comfortable banking online, and some people are not. Also, if you feel more comfortable working with a bank that has local branches for you to visit for assistance, you might not like the arrangement. EverBank is, after all, an online bank.
Overall, and for most people, I think EverBank is well worth considering.
Their Yield Pledge means you’ll no longer have to switch banks every few months to get the best rates, and the cost of doing business with them is near the bottom end of the banking scale. Check out EverBank and see if it will be a good fit for you. I’m guessing it will be.
Click here to sign up for EverBank or see more details on their accounts.