December 5, 2018 12:00 PM PT

Popular Direct Bank Review

Read more about Popular Direct
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Are you tired of the minimal interest rates offered on savings accounts? If you choose an online-only bank, like Popular Direct Bank, it may help solve your problem.

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As a division of Popular Bank, Popular Direct Bank provides higher interest rates than you may find at your local banks on savings accounts and CDs. Popular Bank has 122 years of history behind them, which may provide you with a little more reassurance than newer, online-only startup banks.

Keep reading to see if Popular Direct Bank is a bank you should consider.

Savings

The Popular Direct Plus Savings Account offers a high-yield APR with interest compounded daily. You'll need a minimum of $5,000 to open this account. They do charge a monthly service fee, but you can waive it by maintaining at least a $500 average daily balance.

If you open the Popular Direct Plus Savings Account, keep in mind that you can only make up to six withdrawals per cycle. Any withdrawals beyond that will incur the excessive withdrawal fee. Popular Direct also charges a "dormancy fee" if you don't conduct any activity in this account in 12 consecutive months.

CDs

If you have money set aside that you don't anticipate a current need for, you may earn higher interest rates on it with Popular Direct CDs. You can choose from a 3-month, 6-month, 12-month, 18-month, and 2-year through 5-year term.

The longer the term, the higher the interest rate Popular Direct will offer, but don't choose a term you can't stick to or you'll pay a hefty penalty for early withdrawal.

The interest compounds daily on the Popular Direct CDs, but you'll need $10,000 to open one. There is no minimum balance requirement you must meet and the same interest rate pertains to every balance (they don't have tiered interest rates).

You have a 10-day grace period upon maturity to either withdraw the funds or roll them into another CD. If you miss that window, they automatically roll over.

Interest Deposits:
Popular Direct deposits interest directly to your CD balance at the end of each month. You cannot withdraw the interest until CD maturity. This is unlike CDs at other banks that allow you to have the interest credited to a checking or savings account, so it's something to consider.

Reasons We Like Popular Direct

  • Popular Direct customer service reps are available 24/7. This is a nice feature, especially since you can't go into a bank branch to ask questions.

  • You won't pay an overdraft fee if you overdraft your account $5 or less. Overdraft fees can add up quickly if you aren't careful. It's nice to know that a small overdraft won't affect your finances.

  • You can make deposits with your mobile phone. Download the Popular Direct Bank app and you can deposit your checks with just a picture of the front and back of your check.

    Once you follow the prompts in the app, you deposit your check from the comfort of your own home.

  • You can sign up for account alerts. This can help you keep track of your balance while on the go. It can also help you know when something is amiss with your account, such as fraudulent activity.

  • Popular Direct Bank offers daily compounded interest. While you won't see a major difference in the interest earned, you will earn a little more as your interest earns interest throughout the month.

  • You earn interest on all balances. Popular Bank Direct doesn't require a minimum average balance in order to earn interest on your account. You just need a $0.01 balance to earn interest. You may want to exercise caution, though, as there could be a penalty for low balances (see below).

  • You don't have to live in a specific state to open an account. Since Popular Bank Direct is an online-only bank, you can open an account from anywhere in the United States. Just make sure you are comfortable conducting your bank transactions online.

  • The CD and savings rates are competitive. Since Popular Direct Bank is only online, they are able to pass their overhead savings onto customers in the form of higher interest rates. You lose the ability to go into a physical branch, but you earn more money for doing so.

  • You may have access to up to five years of e-Statements. If you opt-in to receive e-Statements, Popular Direct provides access to the last five years' worth of statements. If you come across a situation where you need past statements, this can save you money as many banks charge a fee to get copies of old statements.

  • Popular Direct is FDIC insured. Depositing money with only FDIC insured banks ensures that you'll receive up to $250,000 of your deposited funds back should the bank fail.

  • The minimum opening balances are high. You need at least $5,000 to open a savings account or $10,000 to open a CD. That's not easy for the beginning saver. Other banks have much lower minimum requirements and some banks even have no minimum opening balance requirements.

  • There are hidden fees. Popular Direct advertises that they don't charge any monthly fees, but there are plenty of hidden costs.

    In addition to the low balance fee, there is an early account closure fee, an excessive withdrawal fee, and the dormancy fee.

  • There are no ATMs to use for deposits or withdrawals. This can be frustrating when you have cash to deposit or you want to make a quick withdrawal.

    All transactions occur online only via external transfers (transfers to an existing account at another bank).

Contacting Popular Direct Customer Service:

1-800-274-5696

Routing Number: 113007835.

How It Compares

  • Capital One 360: Capital One 360 offers competitive interest rates on savings and CDs, like Popular Direct. Capital One 360 does offer checking accounts too, though. Capital One 360 doesn't charge monthly service fees or have minimum balance requirements.

    They also provide ATM access to make it easier to access your funds.

  • Marcus by Goldman Sachs: Marcus by Goldman Sachs offers a high-yield savings account and two high-yield CD options.

    You can open an account online in a matter of minutes, but you may only access your funds via electronic transfer to an external account.

Bottom Line

If you have a large sum of money that you don't need access to quickly, Popular Direct Bank may be a good option. You'll have access to higher than average interest rates and minimal fees. If you don't meet the minimum opening requirement or you'll need frequent access to your funds, you may want to look elsewhere.

Disclaimer: Opinions expressed here are author's alone. Please support CreditDonkey on our mission to help you make savvy decisions. Our free online service is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content.

Disclaimer: This content was first published on December 5, 2018. Information including rates, fees, terms and benefits may vary, be out of date, or not applicable to you. Information is provided without warranty. Please check the bank's website for updated information.

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