FILE - An Apple logo adorns the facade of the downtown Brooklyn Apple store on March 14, 2020, in New York. Apple is getting into the Buy Now, Pay Later space with a few tweaks to the existing model — including no option to pay with a credit card. The company will roll out the product to some consumers spring 2023, and will begin reporting the loans to credit bureaus in the fall. (AP Photo/Kathy Willens, File)Credit: ASSOCIATED PRESS
SALT LAKE CITY — Apple has entered the banking industry with a new savings account program including an attractive option for savers.
Apple Card users can now opt for a savings account, provided by Goldman Sachs, which now comes with a high 4.15% APY. That’s much more than the average savings rate for savings accounts, which was 0.37% as of March 2023, according to the Federal Deposit Insurance Corp. as reported by Nerd Wallet.
The Apple account has no monthly fee or minimum balance requirement, according to Bankrate.
Shane Stewart, certified financial planner with DMBA, joins Dave & Dujanovic to discuss how it compares to other savings accounts and if it’s worth considering.
“I looked at other savings plans,” Debbie said, “and some of them require $5,000 to get some sort of great deal on the interest rate.”
Funds in this account are federally insured up to the FDIC’s insurance limits, which generally covers bank account balances up to $250,000, per depositor, per insured bank, per ownership category, according to Nerd Wallet.
“You’ve been following investments and money market accounts for so long. Give us an idea how impressive is this 4.15% return?” Dave asked.
“This type of account [Apple savings] is something that we’ve been advocating for years now,” Stewart said. “They call it sometimes FinTech for financial technology. But these apps have been getting good rates of return, even when rates were low. They were giving better rates than say your brick and mortar [banks and credit unions].
“If you find one . . . a reputable bank like Goldman Sachs, for this particular account that has a decent rate and really no strings attached to getting money in or out or rigmarole about how many times you have to deposit or how much you have to deposit, that’s a real coup.
“I think it’s a real coup for Apple and Goldman Sachs to have about 120 million iPhone users at their disposal to market that to. It’s really a great account,” Stewart said.
“I do wonder how much of this is just a teaser rate. ‘Hey, we’ll get you in for 4.15%.’ Next month that’s 3.15. The month after that it drops down. How much should I be able to rely on this 4.15%,” Dave asked.
“That’s what I like about you, Dave, you’re always making sure it’s legit,” Stewart said. “And in this case, it is. This is the going rate for these types of online — with no brick or mortar — accounts. And the reason being is because they don’t pay rent. They don’t pay tellers. They pass it on in the form of interest — and these are legit. This is about the going rate for online savings accounts right now.”
“Shane, I’ve also looked at CD — certificates of deposits. Those offer that same ballpark [ as 4.15% APY], but then you’re locked in,” Debbie said. “I mean, you got to be locked in for a year or two years or five years or something like that, and you can’t have access to that money.”
Stewart said that certificates of deposits offer higher interest rates because they operate under the assumption that you won’t withdraw any money until the CD matures.
“There’s nothing wrong with that [CDs] if that’s what you desire for your money, but if you desire access and the flexibility,
these [online savings accounts] are a great alternative to that, unfortunately, for local banks and credit unions,” Stewart said.
Apple’s New 4.15% APY High-Yield Savings Account: What to Know
Dave & Dujanovic can be heard weekdays from 9 a.m. to noon. on KSL NewsRadio. Users can find the show on the KSL NewsRadio website and app, as well as Apple Podcasts and Google Play.