Discover Bank Online Savings Account Review

Last updated on July 25th, 2017

Having grown tired of bank accounts that pay no interest, I recently decided to shop around and compare my options. After some reading and research, I found the Discover Bank Online Savings Account and decided to open an account. 

As a reminder, a savings account is best suited for short-term financial needs. The money is readily available for withdrawal, but you might lose purchasing power due to inflation.

If you are looking to build wealth and fund your long-term financial goals, you should consider investing in other financial assets (such as stocks and bonds) which have outperformed cash accounts over long periods of time. If you’re looking for a place to start, I’ve written extensive reviews on great investment firms like Betterment and Wealthfront.

Discover Bank Online Savings Account Review

Discover has been around for decades, providing numerous different banking, loan, and credit card services (including the popular Discover It® card).

The online savings account is one of Discover’s best products, offering their highest interest rate and a robust online interface that allows you to easily link other bank accounts.

Furthermore, there are no account balance requirements and no monthly maintenance fees.

Discover makes it easy to connect other checking or savings accounts through the online interface. This makes it easy to send/pull money from external accounts, and Discover charges no fees to initiate a transfer.

All online savings accounts, including Discover, impose a maximum limit of six external transfers per statement cycle. You are allowed only six (6) transfers from your Discover savings account to any other bank account. The number of deposits into the Discover Savings Account are not restricted. 

If you exceed six transfers, you will be charged a fee. This transaction limit is part of recent Federal regulations and applies to all online savings accounts (not unique to Discover).

Discover Savings Account Features

The Discover Online Savings Account includes a number of different benefits and perks:

24/7 (U.S. based) Customer Support: Our interactions with Discover customer support have been pleasant. Most agents are kind, helpful, and speak English well.

1.10% (Current APY) Interest Rate: Interest is compounded daily and credited monthly. This is a highly competitive rate compared to other accounts.

FDIC Insurance up to $250,000: If anything should go wrong with Discover Bank, the federal government insures each account up to $250,000 (per account owner).

Discover Mobile Banking App: Control everything from your smartphone or tablet. You can check your account balance, view recent account activity/earned interest, and make transfers.

Auto Saver Features: The Discover Savings Account allows you to create automatic transfers from your personal checking account into your savings account each month.

No Minimum Balance 

No Monthly Fees

Opening a Discover High Yield Savings Account

Opening the Discover Bank Savings Account is a 3-step process which can be completed online. Like most other financial accounts, it takes about 15 minutes and requires some personal information including your name, address, date of birth, and social security number.

  1. Enter your personal information and choose between an individual or joint account.
  2. Fund your new Discover Bank account via ACH transfer from another checking account (our choice), or by wire transfer.
  3. Verify your credit information and electronically sign your application. Bank verification might ask you about items on your credit report such as old addresses or loans, which is the standard process to verify your identity.

After completing the online application, you’ll be completely ready to begin using your account and earning interest.

That concludes my Discover Savings Account Review. If you are interested, you can open your account at Discover Bank Online.

Discover Bank Online Savings Account Review
Summary
Quality customer service, solid interest rates, and overall ease of use have made the Discover Online Savings Account our top choice in the high yield savings category.
Features8.6
Total Cost9.4
Ease of Use9.1
Customer Support9.1
Strengths
No minimums or fees
Great customer support
Competitive interest rates
Weaknesses
None
9.1
Overall
Comments
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    • Al
    • June 21, 2017
    Reply

    For Discover HYSA, is there a limit on the amount per withdrawal? I am planning on setting up a rainy day account and am wondering if I would be able to pull all the money out of it, without any penalty, if I have to.

    Thanks for writing this, it helps a lot in making a decision!

      • Jacob
      • June 22, 2017
      Reply

      Hi Al,
      According to the Discover website, the outgoing transfer limit is $250,000 per 30-day rolling period. I don’t have experience pushing the limit, but please let us know if there are any other stipulations.

    • Ave
    • April 29, 2017
    Reply

    I love Discover Bank. I have savings account with them. Excellent customer service and having 1.01% APY is great!

    • Wynona A.
    • April 19, 2017
    Reply

    planning to open a high yield savings account and kind of torn with AMEX and Discover now. I’m just worried, since money is online, how are we sure that money is secure? Thanks!

      • Jacob
      • April 19, 2017
      Reply

      Wynona,
      The money is FDIC insured, like any checking or savings account at a major bank. Backed by the full faith of the U.S. Government.

    • Lynne
    • December 18, 2016
    Reply

    Jacob,
    Do checks come with the Discover Savings Account? If so, are there any fees associated with them?
    Thanks.
    Lynne

      • Jacob
      • December 21, 2016
      Reply

      Hi Lynne, You can open the Discover checking account at the same time as the savings accounts. I believe all checks are free for the checking account (unless something has recently changed at Discover).

    • Mia
    • November 3, 2016
    Reply

    I’ve been with Discover for 30 years, huge fan.

    Unless I missed it I don’t see one topic covered that was an issue (re: limits for deposits/withdrawals) after recently opening a savings account with Discover. I’m not able to deposit the amount I’d like without waiting until the next month to do so. That’s a long wait. Here’s a copy of the rules from Discover’s site:

    “Incoming limit is $250,000 per 30-day rolling period for each Account Center registered owner, per Account”

    Would you open separate savings accounts at Discover to get around the limitations?

    • JJ
    • August 20, 2016
    Reply

    Hi Jacob, thanks for the greet info and delivering it with clarity! Can you please confirm the best /cheapest way to transfer money out of my Discover savings account to my checking account? I think you said Discover does not charge a fee, but am not sure if there is a way to do it so my other bank (Wells) also won’t charge a fee. To date, I have only deposited checks via mobile banking in my Discover account, which is super easy and fast. Thank you’

      • Kirk
      • March 14, 2017
      Reply

      One down side is there is a $5000 max limit with their mobile deposit and $25,000 max limit over any 30 day period. It is cumbersome if you need to deposit a big check. Compare that with Ally Bank at $50K/$250K limits.

      • Jacob
      • August 23, 2016
      Reply

      Hi JJ,
      If you initiate any ACH transfer (to or from) your Discover account, it is free. Some other banks charge for this, making it one of Discover’s best features.

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    • Bonbon
    • July 21, 2016
    Reply

    Great review! Do you know if there is a usually a fee to do ACH transfers from bank to bank? ie. BofA to Discover?

      • Jacob
      • July 21, 2016
      Reply

      All ACH (push from Discover or pull from another account) are free from the Discover side.

    • NIck
    • July 6, 2016
    Reply

    The section in your blog about Discover’s fees, “Discover does impose a maximum limit of 6 money transfers per statement cycle. If you go over that amount, there is a fee.” makes it sound as if this is not the case with other banks. The limit of 6 withdrawals per calendar month is a federal law applying to all savings accounts, imposed some years ago. You will not find any savings account at any bank that does not have a similar fee.

      • Jacob
      • July 7, 2016
      Reply

      Excellent point, Nick. I’ll have to reword that.

    • Nick
    • May 22, 2016
    Reply

    Help, I am trying to make a decision between Amex and Discover online saving accounts. Just a college student trying to set up an emergency fund when I need it with good rates. Read both of your reviews on both companies, just want some feedback.

      • Jacob
      • May 23, 2016
      Reply

      Discover, 100% of the time.

    • bob
    • May 11, 2016
    Reply

    if we have a joint account, does that means FDIC insurance will cover $500k since each account holder will be covered by $250k?

      • Jacob
      • June 8, 2017
      Reply

      I believe you are correct Bob.

    • Small Fry
    • April 29, 2016
    Reply

    I use the Discover It Card myself, along with Discover Bank. I find it to be the simplest way to save money, and have my credit card, savings, and checking account all on the same web site.. I find Discover card is accepted almost everywhere in the United States, I was over in Puerto Rico and I was able to use it over there too.

    • Daniela tavarez
    • February 24, 2016
    Reply

    If I open a savings account through Discover and then the current interest rates raise would I get the new one Interest rate added to my account ?

      • Jacob
      • February 29, 2016
      Reply

      Yes, it adjusts for new and existing members when rates change.

    • Daisy
    • February 10, 2016
    Reply

    It’s a plesaure to find someone who can think so clearly

    • Ron
    • December 31, 2015
    Reply

    I currently have the Amex online savings account. Any notable differences or quirks compared with the Discover online savings account?

      • Jacob
      • January 3, 2016
      Reply

      Discover is easier to make transfers, better customer service, and has the best features.

        • svb
        • January 22, 2016
        Reply

        Which bank offers free transfers i.e. deposits and withdrawals to the Western Union Netspend account. I currently have PNC and TD bank and I’ve noticed that I can’t add the netspend account using the account and routing number through PNC, however with TD bank there appears to be a $3 charge for all transfers. Please advise.

          • Jacob
          • January 22, 2016
          Reply

          Discover Bank

    • Fei
    • December 24, 2015
    Reply

    Thank you Jacob for sharing it; it’s really helpful. I wonder if the interest would be taxed and how much it would be. Thank you!

      • Jacob
      • June 8, 2017
      Reply

      All interest is taxable, the rate depends on your level of income.

    • Jim
    • November 19, 2015
    Reply

    Hi Jacob, your review and the comments were one of the reasons we gave Discover online savings a try. I read here and elsewhere than deposit times can be longer at Discover than at Amex, so we just tested that theory. We opened accounts with both, and set up ACH links both ways from our USAA checking to each account. On Tuesday morning at 7am, we initiated four transfers. A “push” to each savings accounts from checking, and a “pull” into each savings from checking.

    Results? the SAME! Both “pushes” initiated from our checking account arrived into Discover and Amex the very next day. Both “pulls” initiated from savings were reflected right away in our savings accounts, but the money didn’t actually arrive till a few days later, and were held for 5 business days after that at both accounts.

    Conclusion? There’s absolutely no difference in the speed of transfers between Discover and Amex. If you want to move money from your checking into your online savings account, initiate the transfer from your checking account, and it will arrive the next day into your online savings account. Of course, if your sending bank is slower, your results could vary, but it won’t be because of Discover or Amex.

    Since Discover has a slightly higher interest rate, a mobile app, and the ability to deposit checks directly using their app, we too are going to stick with Discover for now. Thanks again for the review!

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    • Shawn
    • November 10, 2015
    Reply

    I was curious about what you think of GE Capital Bank’s online savings account?

    PS- The reviews you did of both Betterment and Wealthfront were very helpful when making a choice between the two. The pros, cons, and features that differentiated the services were very well structured and easy to read.

      • Jacob
      • November 11, 2015
      Reply

      Shawn, I don’t have experience with them, so can’t say. I’ve heard customer service isn’t great, so I’m not overly interested in making another account there.

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    • Jane Pierre
    • September 28, 2015
    Reply

    I have a capital one 360 saving account. I can open another one with them but I was exploring for better options and stumbled upon your article. Should I close my 360 and open a discover saving? Or keep 360 and open discover. I do have a discover credit card. Please help. Thanks

      • Jacob
      • September 28, 2015
      Reply

      It doesn’t matter either way, as you can have multiple savings accounts open. You can keep both or close your existing account (I don’t think Cap1 360 has any penalties, but check).

        • Jane Pierre
        • September 28, 2015
        Reply

        Was debating on a loan to pay off my discover card since those interests rates killing me. Any advice on best way to approach that? Thanks

          • Terre
          • April 26, 2017
          Reply

          With a good repayment record you can get one or more 0% apr balance transfers, which can last from 10 months to 18 months with a 1-5% fee on the amount transferred.

          A common fee is 3%, so if you transfer $10k of your Discover balance to BofA, for example, it would cost you $300 right off the bat. This is added to whatever amount of money you transferred, and shows up at the bank that gives you the balance transfer. But the interest stops accumulating, so you can get a handle on paying off the amount you owe and stop feeling like you’re running up a giant sand dune.

          This can be done from within Discover (go to your online account or call them to see what you’re eligible for) or you can apply for new credit with some other banks.

          I was able to pay off $45K of debt in a little over two years by doing this. I had an excellent repayment history but a high utilization rate, and some cards only gave me $2000 in credit. But with that 0% balance transfer, I figured out what I had to pay every month to get it paid off by the end of the balance transfer time, and set up autopays so I never missed a payment. My FICO went up to 849, though that number is capricious as heck. The numbers that matter are your balances due.

          Now I make sure and pay things off before any interest is charged. I also relied on CreditKarma.com for financial education and information about what I owed throughout my big financial reset.

          Good luck!

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    • Mystech
    • September 21, 2015
    Reply

    Thanks for the review, I think I’m going to switch to Discover’s Savings account.
    Perhaps a couple years ago Ally Bank deserved the praise and business, but they have plummeted in recent months. Their app is regularly down, their interest rate is almost half what it was and most recently, they punitively even locked me out of my own account for complaining about slow / non-existent customer support (1-2 days because THEY have the wrong identification information on file). Believe it, 15 minutes after I filed a complaint with them over their customer support, they changed my pin and locked my online account “for security review”. Avoid Ally Bank.

      • will
      • August 28, 2016
      Reply

      I wanted to comment. Ally is a bunch of aholes.I had an angry well. i won’t describe her ethnicity, curse me out about only keeping minimum funds in each account and called it shady.They closed my accounts and sent me all my money

      • Lavina
      • May 1, 2016
      Reply

      I agree. I have accounts at Discover and Ally. Customer service at Discover has been very helpful. Customer service at Ally has cost me money, and offered no recourse and no apology. Because of their poor service I will soon transfer all funds to Discover.

      • Jacob
      • September 21, 2015
      Reply

      Thanks for the feedback.

    • Jeremiah
    • September 3, 2015
    Reply

    What are your thoughts on My Savings Direct, which currently is offering around 1% for their online savings account. They also boast to have America’s highest rate consistently. Think they’re reputable enough, or safe enough to open an account and move money from say AmEx?
    Also, for a long time investor (Roth IRA and 401k for the past 10 years) but wanting to break into the stock market through stocks and bonds, would you suggest Betterment, the investment firm mentioned earlier? I very much enjoy investing, and am unsure if I should move towards something like Vanguard or Betterment. Thanks for your thoughts and wisdom! Really appreciate your blog!

      • Jacob
      • September 3, 2015
      Reply

      Hey Jeremiah, thanks for stopping in and for the kind words.
      I haven’t ever heard of My Savings Direct, so can’t say for sure. I typically stick with the bigger banks because I think they will be around for a long time.
      Regarding stocks and bonds, Betterment is excellent if you don’t want to spending any time messing with your portfolio. They do a great job at asset management, and require nothing from you (except a small annual fee). Vanguard is great for the DIY investor.

    • Tom
    • August 13, 2015
    Reply

    I am interested in an account with POD (payable on death). I know American Express does but can’t find if Discover does. I have a ING and now Capitalone 360 does not so need to make a change.
    Thanks

      • Jacob
      • August 15, 2015
      Reply

      Yes, it includes POD when you name your beneficiary on the account.

    • BN
    • August 6, 2015
    Reply

    Hi Jacob,
    Thank you so much for your valuable article. I do have few clarifications,
    > I have read that fund transfer(internal/external)is free. Does it mean that I can transfer money to my friend who has other bank account(ex: Chase)?
    I have Bank of America checking account, but they charge fee for transferring money to other banks(ex: Chase).

    > I am not familiar with APY. For example, If I maintain $5000 in Discover savings account, how much will I receive as interest at the end of month?

    > Can we use Discover savings account Debit card in all stores(like WinCo, Food4Less)?

    Thanks

      • Jacob
      • August 12, 2015
      Reply

      Yes, ACH transfers are free. And online savings accounts don’t typically issue a debit. That’s for checking accounts

    • Gary
    • July 25, 2014
    Reply

    Thanks for the review! I was looking for an online savings when I ran across your blog. I called and opened an account with Discover, and I found your assessment to be quite true! They were great! It was refreshing!

      • Jacob
      • July 25, 2014
      Reply

      Glad to hear your success, Gary. Thank you for sharing.

  10. Reply

    Greetings Jacob,
    First I must commend you for this blog. I link it to all my friends who ask about financial help. They want to start saving money now that there finely making it. But there scared of the old systems of investing that were used during the recession. (just as I am.) Now I just link them to your blog and tell them: Read this, it will take the fear of investing right out of you. So thanks! You pair financial expertise, with a modern tech embracing intellect. So cheers to you and your wife!

    But, I digress. My main question for you is. I want to use your system of a local bank for my checking account (I prefer credit unions for their various pros. But when it comes to a checking account, same difference.) Paired with a great interest rate online bank for my savings account. I have been aware of Ally bank for quite some time. But your article here made me see Discover has a similar account type. Have you had any experience with Ally bank? if so what would you suggest: Ally or Discover? The pro with discover as of now is I also have a Discover It card. So I could handle all my web-based transactions with one account, and one app. as opposed to Discover for card and Ally for banking. But Ally has been doing modern online banking for so long, and are so highly rated. Is there any Pros/Cons to Ally vs Discover? Or do they both offer the same free features, same fee rates, etc? If there the same feature wise id probably go with Discover for the one app convenience. But if there is a pro to Ally that Discover doesn’t have. Id rather go with Ally. I wanna go with the one that’s the best deal, over just the ease of convenience. I know the interest rates will vary. But I don’t plan on chasing the best all the time. Just want to find one that is actually competitive, and stick with it. Even if it’s a few points off from the current leader. Thank you so much for your time and help. Best wishes to you and the family.

      • Jacob
      • April 25, 2014
      Reply

      Frank, first of all let me say thank you for such a kind and thoughtful comment. You’ve really made my day.
      I do not have prior experience with Ally, so I can’t say too much about them. But I do have an extensive background with Discover and Discover credit cards, as you mentioned. From the reviews that I have read, they offer similar features, although I’ve seen more positive reviews with Discover. This is primarily due to great customer support (which we have always adored). Neither should charge you any fees, so pick the one that is convenient right now. Sounds like that might be Discover.
      Thanks for sending us readers and for voicing your questions. Email or comment anytime!
      Jacob

    • Andrew
    • April 21, 2014
    Reply

    Just recently found your site and think it’s great you are trying to help people in our generation to save for their retirement.

      • Jacob
      • April 21, 2014
      Reply

      Hey Andrew, thanks for the kind words!

    • [email protected]
    • April 20, 2014
    Reply

    Jacob,

    Thanks for the review of Discover Online Savings Account. The interest rate that they offer is definitely the highest I have seen for a savings account. I also like the fact that their initial deposit requirement is pretty low, not to mention the fact you do not have to maintain a certain minimum balance. I will bookmark them because you can never have enough saving vehicles. Thanks

      • Jacob
      • April 20, 2014
      Reply

      No problem Nate, thanks for stopping in and leaving a comment. Good interest rate and we’ve always had great customer service, so they a are top notch option!

    • Kalen @ MoneyMiniBlog
    • April 20, 2014
    Reply

    Nice review! Well written.

    I think I may try this, because I went to Aldi’s (a grocery store) yesterday and found out that they only take Discover…random, I know.

    I already have a Visa, Mastercard and AmEx for rewards points, so I might as well get a Discover while I’m at it. lol

      • Jacob
      • April 20, 2014
      Reply

      Thank you! We love the Discover It 5% cash back card, and The high yield savings accounts is quite good also!

    • Brian
    • April 18, 2014
    Reply

    Thanks for the great write up of Discover Bank. I really do like your reviews since they hit the high and low points without too much fluff. Out of pure laziness, I have pretty much stopped rate chasing and have stuck with CapitalOne360.

      • Jacob
      • April 18, 2014
      Reply

      Thanks Brian, appreciate the kind words. Yeah, rate chasing probably isn’t worth it, but I do feel that I should inform blog readers of the best options and my personal choices.

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