Experian, one of the three major credit reporting agencies, recently expanded its product offering to include a competitive high-yield savings account.
Known as the Experian Smart Money™ Digital Savings Account, this account allows users to earn up to 4% APY on their savings, one of the highest savings interest rates available today.
“We know that saving is imperative for many people and this will help them make it effortless so they can reach their goals faster,” said Sean Healey, general manager of digital products for Experian Consumer Services at Experian, in a statement. “Experian is committed to giving people smarter ways to manage their money as a financial co-pilot, and now they have even more opportunities to build a financial cushion.”
But with dozens of high-yield savings accounts on the market, how does this new Experian offering stack up? And could it be a good option for you?
The Experian Smart Money digital savings account offers a tiered interest rate based on Experian membership status. Premium members qualify for up to 4% APY, while other tiers earn 2% or 3% APY.
Please note that making changes to your Experian membership may affect your APY, interest rate, and other account features. Your APY may also be lower during membership trial periods.
Regardless of membership level, there is no minimum deposit required to open an account (although your balance must be at least $0.01 to earn interest) and no monthly fees. Interest on this account is compounded daily and credited monthly.
It’s important to note that Experian is not a bank and does not manage the savings account directly. Banking services are provided by Community Federal Savings Bank; Funds in Smart Money accounts are held in a joint deposit account at Community Federal Savings Bank and are insured up to $250,000 per account ownership category.
Even at the lowest tier, Experian’s High Yield Savings Account offers a competitive APY. The national average savings account rate is currently just 0.39%. Meanwhile, Experian customers can earn 5 to 10 times this average, depending on membership level.
That said, there are some other high-yield savings accounts that pay comparable rates and may even offer similar features, without the need to sign up or pay for a membership. Examples include:
The Smart Money account has no monthly fees or minimum balance requirements, making it accessible to beginners or anyone who wants a low-maintenance place to store cash. That said, because it’s built into Experian memberships, the account may be more attractive to people who already use Experian tools to track their credit or manage their finances in one place. Otherwise, the cost of membership may outweigh the benefits of getting a higher rate.
When choosing a high-yield savings account, it’s important to consider more than just the interest rate. You should also pay attention to fees, minimum balance requirements, and obstacles you need to clear to get the highest rate. Also consider convenience factors, such as mobile tools, transfer speed, and ATM access.