Dollar Savings Direct Is An Emigrant Direct Clone

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Dollar Savings Direct LogoWhen Dollar Savings Direct first appeared, I thought Dollar Savings Direct was an Emigrant Direct clone. I chatted with a CSR and learned that it was once Banco Fortuna, Emigrant Bank’s attempt to market to the Spanish-speaking banking market, and merely rebranded in English. While it wasn’t their intent, the end result is clear: Dollar Savings Direct is a clone of Emigrant Direct (both are subsidiaries of Emigrant Bank, FDIC #12054) but with a $1,000 account minimum and a better interest rate (4.00% APY).

Opening a new Dollar Savings Direct account was quick and easy. I did what any sane person would do, I closed my Emigrant Direct account and opened a new Dollar Savings Direct account. Emigrant Direct has a 3.00% APY rate and Dollar Savings Direct offers a 4.00% APY, which leads most high yield savings accounts rates. My plan is to put all new funds into the Dollar Savings Direct account.

On the fact that their clones of each other. On one hand, I’m a little miffed that Emigrant Direct didn’t just fold Dollar Savings Direct into it and just offer the 4.00% rate. On the other hand, it doesn’t really affect me too much as opening new savings accounts don’t affect your credit score (most of the time) and I didn’t have much in my Emigrant Direct account in the first place so it’s not too much hassle.

Savings account interest rates can change. Remember that savings interest rates are not guaranteed, they can change at any time. It’s pretty easy to lock in a much higher CD rate nowadays if you want to go that route. Surprisingly though, since August 30th, when I first looked at them, their rate increased from 3.75% APY to the current rate of 4.00% APY)


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21 Responses to “Dollar Savings Direct Is An Emigrant Direct Clone”

  1. Ken says:

    Unfortunately, many online banks have started this policy of creating new savings accounts with high yields and then maintaining low rates on the old accounts. The new account allows them to get new depositors without having to pay the high rate to all existing customers. Many of the existing customers in the old accounts fail to notice the new account or don’t take the time to switch

    It’s probably like those mail in rebates. Manufacturers expect at least half of the customers won’t mail them in. So just like those mail in rebates, if you want the best deals, it requires some extra work.

  2. indio says:

    Did you verify the stability of Dollar Savings Direct? I’m wondering if Emigrant Direct set it up to put sub prime or other loans in it? I checked bankrate when I decided to move money from HSBC, because they were doing layoffs, over to Emigrant Direct. I don’t want to have to deal with FDIC and that whole rigamarole if the bank goes under.

  3. jim says:

    @indio: That’s extremely doubtful, DSD is as stable as Emigrant Direct because they share the same FDIC insurance certificate number. It’s the same bank.

  4. Trevor says:

    You’re absolutely right! Interest rates on these accounts change all the time. It’s really sort of hard to know when is best to lock into a good CD and when it might be better to get into a good money market.

    Thanks for your comments. Love the blogs!

  5. Jim’s right, they’re the same bank. It’s likely that Emigrant set up DSD to attract new money without having to pay their current depositors a higher interest rate. Rather clever of them, actually.

  6. John says:

    Came across this blog by happenstance. I too have an Emigrant Direct account which is now being moved as described above. I am surprised that I never saw this information mentioned in magazines I read: Kiplinger, Smart Money, AAII, etc..
    thanks

  7. jim says:

    It takes a bit of time before things get into magazines and newspapers, a blog with one person writing who is not beholden to advertisers can react much faster to the news. :)

    I hope you subscribe and stick around!

  8. Jeff says:

    How does the Dollar Savings ease of use compare to say ING Direct or FNBO?

  9. Joe B says:

    Opened this today, plan to move money from the Costco Capital One account, which has a $10,000 minimum to get 3.5%. The Capital One account says 5 day wait on deposits, but it is really about 10 days since they also include their schedule time as well, even if the money moves long before.
    The advertising for Dollar Direct seems to be a paid placement on Google. They show up as in the paid advertisement section at the top.
    Washington Mutual used to be near the top of online account interest and had an immediate link to my checking account-very convienient. Since being taken over by Chase/Morgan, they have dropped their online rate to 2.25% with no notification. Too bad. I’ll bet they lost a lot of deposits in a very short time, including mine.

  10. KingAsa says:

    Take a look at DollarSavingsDirect’s website. Are they now offering a 4.00 APY CD? If so, what sense does that make? I hope they’re not trying to say that all of the accounts opened there are considered CD’s.

  11. jim says:

    The CD’s rate is fixed and can’t go down (or up) whereas the savings account rate can change anytime.

  12. Mike W says:

    Count me in as another who just opened a DSD account and am transferring just under 6 figures from Countrywide who’s interest rate is down to 2.4% now.

    • Mike Not W says:

      Hi Mike – Completely not understanding your situation, I just can’t help to think that your $100,000 can’t earn a bit more than 4%. There’s that saying “it takes money to earn money,” and sure you’ll get around $330/mo interest. I myself am a rate chaser, but I’ve been trying to push myself to find other alternatives (obviously our country doesn’t value savings right now). Take for example a stable common stock. With a dividend of around 7% and a very low price that may have stabilized, you could very well go up 25% in a year ($2,080/mo.) – at the very least, there are stock dividends that aren’t directly affected by a stock’s value – commonly with a 5-9% APY. Of course, a CD is 99% safe, while a stock could become worthless. But there’s also the tax issue – with the CD, your earnings will be with your income in a 25-35% tax bracket. The stock/dividends would be in a 15% capital gains tax bracket.

      • MIke W says:

        And if I took your advice 6 months ago, I would be out a hell of a lot of $$ right now.

        This is house DP/ Life savings and is no way to be meant as risky in any way what so ever.

        Want best return in ULTRA safe environment.

        And country Wide is down to 1.9% now.

  13. James B says:

    Mike Not W says the stock/dividends would be in a 15% cap gains bracket. I think if the stock were sold for a gain it would indeed be in the 15% bracket, but the div received would be taxed at ordinary rates.

  14. David says:

    Mike or MikeW The dividends would be taxed at 15% only after you hold that stock for 120 days.

  15. alvin cohorn says:

    dsd does not divulge external in-out maximums on their site –daily-monthly. this can be critical.

  16. alvin cohorn says:

    the bank can require 60 days WRITTEN notice before any withdrawal of any amount..read their disclosures.

  17. Teresa says:

    Can anyone please advise me how to get to the old Emigrant Direct that will recognize my ID?

  18. paula says:

    cant help noticing that the reviews for Dollar savings direct are a little outdated. I am also with Emigrants and the interest rate is sinking What is todays view of Dollar direct.? Really need to move my money Thanks


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