Online banking earns higher interest rates than traditional banking accounts.
If you don’t have quite enough money to meet the limits for a money market account or you don’t want to make your funds inaccessible in case of an emergency, you can still earn a high interest rate through an online-only banking account.
Online banks don’t have to pay the high overhead of traditional banks, so they can afford to pay their customers a much higher interest rate than their brick and mortar counterparts.
They also allow you to pay bills and make transfers in the same way that you are used to, and if you aren’t quite ready to make the transfer to complete online banking, you can have both. Simply open an online account and transfer money from your physical bank to take advantage of the interest rates, but keep enough money in your physical account for withdrawing cash and paying the bills.
You may want to consider the ING Direct Orange Savings Account, a free online savings account that offers a $25 banking bonus to new customers.