Goldman Sachs Bank USA — a division of one of the world’s oldest investment banks — is a relative newcomer to the online-only side of the banking industry, but it offers one of the most competitive savings rates available. It has both cutting-edge financial technology typical of online-only banks and the benefit of being part of a global financial giant. To help you decide if the online savings account from Goldman Sachs Bank USA is right for you, see if your banking preferences match up with the online bank account’s advantages and disadvantages.
Overview of Goldman Sachs Bank USA
As an online bank, Goldman Sachs Bank USA doesn’t have any physical branches; however, money you deposit is still covered by FDIC insurance up to $250,000 per depositor per account. You can fund your account by electronic transfer, wire transfer or check.
To open a savings account online, you’ll need the following:
- Social Security number
- Email address
- Valid U.S. street address
- Your existing bank account and routing numbers, if you intend to fund electronically
If you’re applying for a joint account, you’ll need this information for both account holders. You must be at least 18 years old to open an account.
Goldman Sachs Online Savings Account Details
Goldman Sachs Bank’s online savings account requires no minimum deposit and has no transaction fees. The account’s current annual percentage rate is 1.05 percent and compares favorably with a review conducted by the FDIC that revealed the national average savings account interest rate was a paltry 0.06 percent. As of March 2017, major competitors such as Bank of America, Citibank and Wells Fargo carried even lower APYs of just 0.01 percent. These rates could change with market conditions and at the discretion of the individual financial institutions.
The current account maximum at Goldman Sachs Bank USA is $250,000 per account holder or $500,000 for joint accounts. This limit includes any interest credited to the account. Before April 15, 2016, the account maximum was $1 million per account or $3 million per account holder for all accounts combined; older accounts can remain at these higher levels.
With a Goldman Sachs savings account, interest is compounded daily and paid monthly. You can withdraw money either through an electronic transfer or via wire transfer. Currently, you can transfer up to $125,000 per transaction. Remember that, per the federal Regulation D limit, savings account holders can only make six withdrawals per monthly statement cycle.
Pros and Cons of Goldman Sachs’ Account
A review of Goldman Sachs’ online bank account reveals low fees, high interest compared to other banks and a number of helpful features. Here are the notable pros and cons of the Goldman Sachs online savings account.
Goldman Sachs Bank USA Online Savings Account Pros
Paying attention to features that are important to customers helps set Goldman Sachs Bank USA apart. For example, the bank offers the ability to send and receive wire transfers for free. Other advantages include:
- 1.05 percent APY, among the highest rates available
- No account fees or minimums
- Online banking accessibility
Cons of Opening This Online Savings Account
Limitations of the savings account reflect larger industry trends, such as a focus on digital banking. If you prefer having a bank branch to visit for your transactions or are looking for a multifunctional account, then you’ll likely view the following account features as disadvantages:
- No debit or ATM card available
- No physical branches
- No ability to transfer funds internationally
Higher Interest Rates and Online Convenience
One of the main reasons why Goldman Sachs Bank USA and other online banks can offer higher interest rates is because they have lower expenses. By not having to maintain branches, a whole host of costs are removed, including physical facility rent, insurance, maintenance and personnel. But to enjoy the benefits of banking with Goldman Sachs, you’ll have to be comfortable with an entirely online operation. Using an online-only bank means you can’t go into a branch and talk to a manager in person if you have a problem. And because this is exclusively a savings account, you can’t go to an ATM if you want a cash withdrawal; however, you can send wire transfers for free.
If you prefer online banking, you could use this Goldman Sachs Bank account to earn a lot more interest on your savings and avoid spending money on fees. For example, if you were to deposit $10,000 at a traditional bank, you might earn as little as $10 in interest over the course of a year. With Goldman Sachs Bank’s 1.05% APY rate, you could instead earn $105, or more than 10 times the interest. The interest earnings potential and cost savings associated with the account make it an attractive savings vehicle.
Up Next: How to Open a Bank Account Online
This content is not provided by Goldman Sachs. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author and have not been reviewed, approved, or otherwise endorsed by Goldman Sachs.