Apple Bank Account: Is It Worth It?

Apple Bank Account
Image credits: Big Tech Wire

Apple recently launched a high-yield savings bank account administered by Goldman Sachs, offering 4.15% APY on your savings. While that amount is more than 10 times the national average APY, it’s not the highest rate available in today’s climate. Some accounts earn APYs of 5.00%, and a few are even starting to brush up against 6.00% APY.

However, Apple Savings could be a convenient way for Apple Card users to make their Daily Cash, (the money earned through Apple’s cashback program) grow in a way it otherwise wouldn’t.

How the Apple Bank Account works

When you set up Savings, you agree to have future Daily Cash automatically deposited into your account. This allows you to earn interest on the Daily Cash that you get back from Apple Card purchases. You will also earn interest on deposits that you make to Savings from a linked external bank account or from Apple Cash. And, there are no fees or minimum balance requirements.

You can’t spend money or make purchases in Savings directly through your Apple Card or Apple Pay. If you want to access your funds, you can transfer money from Savings to Apple Cash or to a linked external bank account.

Only Apple Card Family account owners and co-owners can set up Savings. Savings accounts set up by Apple Card owners and co-owners are separate, individual accounts. Savings does not offer a joint account feature. Apple Card participants aren’t eligible to set up Savings accounts.

What you need to open and maintain an account

  • Be an owner or co-owner of an active Apple Card account, and add Apple Card to your iPhone.
  • Update to iOS 16.4 or later.
  • Be at least 18 years or older.
  • Have a social security number or individual taxpayer identification number.
  • Be a U.S. resident with a valid, physical U.S. address.6
  • Set up two-factor authentication for your Apple ID.

How to set up Savings

  1. On your iPhone, open the Wallet app and tap Apple Card.
  2. Tap the More button, then tap Daily Cash.
  3. Tap Set Up next to Savings, then follow the onscreen instructions.

When opening Savings, you’ll be asked if you want to transfer funds from your Apple Cash balance to your new account to start earning interest on that money. If you don’t want to transfer your Apple Cash balance, just tap the Close button. If you want to transfer funds, tap Transfer Your Apple Cash and follow the onscreen instructions.

If you have any Daily Cash available to redeem as an Apple Card statement credit, that Daily Cash will be transferred to your new Savings account when you set up Savings.

If your Apple Card account is restricted or locked, you may not be able to open a Savings account. If your Apple Cash or Savings account is restricted or locked, you may not be able to transfer money to or from Savings. To access your funds, you will need to contact a Savings Support Specialist.

Deposit money into Savings

When you open Savings you agree to automatically deposit Daily Cash that you earn into your Savings account. You can also add money to Savings from a linked external bank account or from Apple Cash.

  1. On your iPhone, open the Wallet app and tap Apple Card.
  2. Tap Savings account, then tap Add Money.
  3. Enter the amount that you want to add, then tap Add.
  4. Choose the pre-selected external account, change it, or add a new one. If you haven’t added a bank account, follow the steps in View and update your Savings account information in Apple Wallet.
  5. Double-click the side button to confirm with Face ID, Touch ID, or your passcode.

Money that you deposit into Savings starts earning interest on the day that the transfer is initiated from the Wallet app.

If you transfer money from Apple Cash, the funds are typically available instantly. If you transfer money from a linked external bank account, it will generally take a few days for funds to be available for withdrawal.

Withdrawal options

Once you have an external bank account linked to your Apple bank account, here’s how you make a withdrawal:

  • Open the Wallet app on your iPhone
  • Tap Apple Card
  • Tap Savings account
  • Tap Withdraw
  • Enter the amount that you want to withdraw and tap Next
  • Select the external bank account you want to deposit money into
  • Double-click the side button to confirm the transaction with Face ID, Touch ID, or your passcode.

It typically takes one to three business days for the transfer to be completed. Once the money hits your bank account, it’s ready to be withdrawn.

Account owners can also choose to transfer money from the Apple Savings account into Apple Cash, and these transfers are available for use instantly. Apple Cash also has an option to instantly transfer money (for a fee) to a linked debit card.

This is a potential workaround for the waiting period, but is still less convenient than withdrawal methods offered by other high-yield savings accounts.

How to view your Savings account balance and interest earned

  1. On your iPhone, open the Wallet app and tap Apple Card.
  2. Tap Savings account. From here you can see your Current Balance. This may include pending transactions or deposits, so the entire amount may not be available for you to withdraw immediately.
  3. Tap the More button, then tap Account Details to see your Available Balance. This is the amount that you can withdraw immediately. You also see any interest that you’ve earned this year and your current Annual Percentage Yield (APY).

Interest that you earn is compounded daily and credited to your Savings account monthly.

Who is the Apple Bank account for?

Apple Savings could be a good fit for Apple Card users. Unlike many other savings accounts, you’ll need to have an Apple Card in order to access this account. Opening an Apple Card could give you access to the savings account.

However, you shouldn’t just get a new card without thinking through the consequences. For example, if you’re applying for a mortgage, it might not be the right time to open a new card. Opening a line of credit can cause your credit score to drop a few points, which could work against you when buying a home.

Pros and cons of Apple Bank Account

There is no denying that the Apple bank account is attractive. However, it’s not without flaws. Here are the top perks and what we believe could be improved.

Perks
  • 4.15% APY: While brick-and-mortar bank customers are lucky to earn 2% on their savings accounts, Apple offers more than double that. It’s not the highest interest rate available, but it is up there.
  • No limits on Daily Cash: Many longtime Apple enthusiasts made the Apple Card their credit card of choice when it was first released. One of the things they’ve come to count on is the amount of cashback they earn for each purchase. Any Daily Cash earned is automatically deposited into their Apple Savings account. For some, it makes saving a little easier.
  • No fees: Apple said “no junk fees”, and it means this. In addition, there is no minimum deposit required and no minimum balance requirement.
  • Ability to link accounts: Customers can easily link their Apple Savings account to another bank account. Linking the two accounts means it is easy to move money between them as needed.
Areas of improvement
  • Must be an Apple Card user: This restriction alone means Android users are out in the cold. This also means that you need to have an iPhone.
  • Must make a transfer to access cash: Unlike your typical bank or credit union, you can’t simply drive up to an ATM to withdraw money from your Apple Savings account. First, you need to transfer the money from the Goldman Sachs account in which it sits to an external linked bank account and wait up to three business days for the transaction to clear. Only then can you withdraw the desired amount. While the process is straightforward, it may be frustrating in emergency situations.
  • There’s a learning curve: For an Apple user who has not set up Apple Pay or applied for the Apple Card, it can take time to familiarize themselves with how each Apple product works independently and together.

How the Apple Bank account stacks up to the competition

There are a number of high-yield savings accounts on the market. Here’s how Apple’s savings account compares to other high-yield savings accounts. 

Accessibility

If you don’t have an Apple Card and don’t have any plans to open one, you won’t have access to this savings account. 

However, there are plenty of savings accounts that allow you to manage your money from an app and do not require you to be part of the Apple ecosystem. UFB High Yield Savings, for example, offers an interest rate of 5.25% APY and has an app that lets you manage the account available on both the Apple App and the Google Play stores.

Fees

Like lots of high-yield savings accounts, Apple Savings doesn’t charge any service fees or charges. Other banks that don’t charge a monthly fee include Newtek Bank’s Personal High Yield Savings and CFG Bank. However, the latter requires a $1,000 minimum deposit.

Interest rates

Simply put, higher APYs are available for those who want to chase the best possible rate. However, many savings accounts have restrictions on how much money can earn the top-tier rate.

Varo’s Savings Account offers 5.00% APY on up to $5,000, and Mango Savings offers 6.00% APY on up to $2,500 in savings. But, not all have limits. For example, Western Alliance Bank offers a high-yield savings account that earns 5.05% APY without a cap.

However, 4.15% APY isn’t something to overlook. With the average savings account earning 0.24% APY according to Bankrate data, this could be a significant advantage for those who haven’t considered a high-yield savings account and want to work with a platform they already use.

In conclusion: Is the Apple Bank Account worth it?

Apple’s bank account setup is a unique situation because, typically, you don’t have to apply and be approved for a credit card to access a high-yield savings account.

Hence, you should only apply for a credit card if it makes sense for you on its own, and not as a means to some other end. Obviously, Apple is hoping that this savings account will entice some consumers to apply for its credit card.

While the Apple Card is a good card for Apple product users, it fares poorly compared to the best cash-back cards. Other banks, such as Bask Bank or Varo, offer high-yield savings accounts with higher yields than Apple’s, without requiring you to own a specific credit card.

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