The 5 Best Benefits of Apple’s New Savings Account

benefits of apple's new savings account

The 5 Best Benefits of Apple’s New Savings Account

Key Points

  • Apple’s new savings account is actually a credit card and a savings account that go hand in hand.
  • The savings account has a high interest rate of 4.15% APY, which is much higher than traditional savings accounts.
  • There is no minimum balance or monthly service fee for Apple’s new savings account.
  • The iPhone’s Wallet application integrates all financial data into a single report, providing convenient access to savings and spending information.
  • Users can earn up to 3% cash back on select purchases with the Apple Card.

Apple’s new savings account has several benefits that will improve the bottom line for savvy credit card users. While Apple is loudly extolling the virtues of its savings account, it’s actually a credit card and a savings account.

To view one entity without examining the other is an error in judgment. Just like peanut butter and jelly, Apple’s new savings account and Apple’s credit card go hand in hand.

If we’re only examining Apple’s new savings account as a single entity, it would be a cut-and-dry discussion. Jump on the 4.15% APY! Yet, we can’t do that.

We need to untangle the credit card functionality and cost from the savings account functionality. Ultimately, Apple’s new savings account has great benefits for the right kind of credit card and savings account user.

Are you “that kind” of credit card and savings account user? Let’s jump into the details and determine if Apple’s new savings account is a good fit for you.

Some Background on Apple’s Savings Account

In April of 2023, Apple launched Apple’s new savings account program. The high-yield savings account quickly garnered a great deal of media attention.

Within the first month of operation, Apple’s new savings account program pulled in over one billion dollars in new savings accounts. Within four months, the savings account program recorded over ten billion dollars in new savings accounts.

Apple’s offering is different than other traditional savings accounts. To sign up for Apple’s savings account, a new member must sign up for an Apple credit card, called the Apple Card.

Incorporating a credit card into a savings account is controversial. It’s nearly impossible to only speak of the savings account without including the Apple Card.

A key differentiating factor between the Apple Card and other credit cards is the lack of fees. Apple is making waves in the consumer credit card industry for the lack of fees.

No late fees, service fees, foreign transaction fees, annual fees, or penalty fees. No fees. Period. (A fee is not the same as the interest rate applied to the credit card!)

benefits of apple's savings account
It’s hard to get approved for the Apple Card if your credit score is below 700.

Credit card companies earn the majority of their money from fees. In 2020, the major credit card companies reported 176 billion dollars in income. Seventy-six billion dollars was interest earned (what we pay if we carry a balance from month to month) and 51 billion dollars in fees.

Merchants pay some fees, and the consumers pay others. The lack of fees is a primary reason Apple’s new savings account bank, Goldman Sachs (GS), wants to leave its partnership with Apple. Industry estimates place the GS losses with the Apple Card at one billion dollars.

Quick Facts About Apple’s New Savings Account

Apple’s Savings Account
Interest rate4.15% APY
Opening depositNone
Minimum balanceNone
Monthly service feeNone
Cash earning3% daily, no limit
Monthly FeeNone
Wallet integrationYes

Reasons to Sign up for Apple’s New Savings Account

If you’ve never had a savings account, Apple’s offering may be the jam for your jelly roll! A savings account’s purpose is to provide a safe way for you to save money.

You can save money for a rainy day, a vacation, or an emergency. It’s easy to turn our noses up at the low rate of return on typical savings accounts.

Generally, savings accounts have interest rates far below the rate of inflation. Apple is bucking the trend of low-interest savings accounts with its new high-yield savings account.

1. Interest Rate

Apple’s new savings account offers a 4.15% annual percentage yield (APY). The APY is a value that indicates the yield on the saving account after interest is applied. Apple’s savings account interest compounds daily but is applied to the savings account once a month.

How Does APY Function?

For example, if you have $100 in your savings account this month, you’d earn interest on the $100. Let’s say you earn one dollar based on a .01% interest rate.

Next month, you’ll earn interest on $101. The APY lets us know how much annual interest rate we’ll gain. Traditional savings accounts have a terrible APY.

Low-Yield Interest Savings Account

The typical low-yield interest-rate savings account has an interest rate of .42%.  Some savings accounts may have an APY as low as .01 percent! Apple’s new savings account has a much higher APY at 4.15% APY.

High-Yield Interest Savings Account

The higher interest rate will absolutely make an impact on your bottom line. Keep in mind that the purpose of a savings account is to save money, not to be utilized as your primary investment vehicle.

Investments provide (hopefully!) a much higher rate of return but less liquidity. A savings account has less interest return on your principal deposit but plenty of liquidity. If you need to withdraw today to purchase new brakes for your car (we hope not!), you can do so easily.

If you have investments, you’d need to sell the investments, which might take time. After selling, you’d need to transfer the money to your checking account (more time) and pay taxes.

benefits of apple's new savings account
Apple’s 4.15% APY is, as of June 2023, nearly 10 times the national average of 0.42%.

The 4.15% APY is a reasonably good rate for a savings account but not a reasonable rate for an investment account. There are other high-yield savings accounts with higher rates of return, but they may require a few more hoops that you’ll need to jump through.

2. Opening Deposit

Apple’s savings account requires a zero-dollar opening deposit. How is this possible? To open Apple’s new savings account, you must first open an Apple Card. If you make it through the credit card screening process, you can open a savings account.

Minimum Balance

Apple’s savings account has no minimum balance. You’ll earn interest if you have $1 deposited (not much!) and interest if you have $100,000 invested. Other types of high-yield savings accounts require minimum balances to earn interest.

For example, The CIT Bank Platinum savings account pays a 5.05% APY but only on balances greater than $5,000. That’s an excellent example of how Apple’s new savings account can benefit you with a higher APY than a .01% APY account, but not require you to have a big chunk of cash to deposit!

Other minimum or zero balance, high-yield savings accounts also pay higher APYs. Based on that, we recommend that you read the fine print carefully.

This will help you understand the pros and cons, fees, minimum balances, minimum monthly deposits, or the maximum number of account activities (withdrawal, transfer, or deposit) of each type of savings account. While it may sound jaded, no one is in business to ‘give’ great savings account APYs.

3. Monthly Service Fee

Apple’s new savings account has a zero-dollar monthly service fee. The lack of a monthly service fee is a reason for lower-balance savings account owners to rejoice!

Do you recall how we mentioned that Goldman Sachs is struggling to make money with Apple’s new savings accounts? The lack of monthly service fees is a piece of Goldman Sachs’s financial struggle situation.

It’s common for savings accounts to charge a monthly service fee if you violate a minimum monthly balance. Perhaps they’ll charge you $12 (cough, cough, not that we’re speaking from personal experience here!), or they might even withhold your monthly interest payment if your account balance isn’t at a minimum balance at any point during the month.

4. Cash Earning

Anytime you purchase with the Apple Card, a cash-earning reward is awarded. 

How and WherePercentage Earned
1% cash back when you use the Apple credit card when Apple Pay isn’t an option.1%
3% cash back from you make a purchase from Apple, Ace, T-Mobile, Nike, Uber, Uber Eats, Panera, Walgreens, Exxon, and Mobil. 2%
3% cash back from you make a purchase from Apple, Ace, T-Mobile, Nike, Uber, Uber Eats, Panera, Walgreens, Exxon, Mobil. 3%

When you earn cash back from purchases, a deposit is placed into your Apple savings account the same day as your purchase. You’ll start earning interest today on purchases made today.

Cash earning isn’t unique to the Apple Card. We recommend finding credit cards that match your spending habits. If you rarely shop with the vendors listed above or don’t use Apple Pay, you may find little value in the cash-back option.

  • Outdoor enthusiasts: REI has a 5% reward for their product and a 1.5% overall reward.
  • Frequent flier: United Airlines offers frequent flier miles, free checked luggage, and flight credits.
  • Trekkie: NASA Federal VISA Platinum has a Star Trek-themed card, a discount on Star Trek merchandise, and redeemable points.

We mention the three very different credit card earning opportunities from credit card companies to illustrate how many different offers are out there. And yes, there’s even a Hello Kitty card.

5. Wallet Integration

A key difference between Apple’s new savings account and traditional ones is the iPhone’s “stickiness.” The average American spends four hours daily on their cell phone and touches it at least 100 times daily.

Apple’s Wallet application will bring you face-to-face with your savings account as often as you want to look at it. Have you noticed how often your cell phone “just so happens” to have an advertisement for something you were just speaking about?

How often does content show up in your TikTok feed that you were just researching on Google? The iPhone’s Wallet will learn about your finances from you!

What’s the best product to pitch to you based on your finances? Your iPhone already reports your web browsing to help identify better advertisements. Why not target your spending habits, too?

benefits of apple's new savings account
Apple Wallet lets you store your credit and debit cards, driver’s license, state ID, boarding pass, etc. in one place.

The Wallet application is tied to your Apple credit card, your Apple savings card, and any other financial institutions that you’ve attached (linked) to the Wallet. You will use the Apple Card to earn the most cash back. Like it or not, Apple is going to learn your spending habits.

As a consumer, the Wallet application provides an excellent financial resource if you’ve linked all your accounts. With a few thumb clicks, you can review your recent purchases or find a specific purchase. You can generate a report of all your spending from the past week, month, or year.

The Wallet application on the iPhone (and only on the iPhone) gives you more immediate access to data summaries of your savings and spending. It’s quick and more convenient access than you might have when/if you switch between cell phone applications. Don’t even start on the ease of an app versus a paper statement!

Alternatives to Apple’s Savings Account

Believe it or not, other savings accounts have equal or better benefits than Apple’s new savings account!

  • bread savings offers 5% APY, a $100 minimum opening balance, and no monthly maintenance fees.
  • Citizens Access Savings offers 4.5% APY, a minimum opening balance of $.01, and no service fees, opening account fees, or hidden fees.
  • Synchrony also has a high-yield savings account with 4.5% APY. There are no monthly fees, minimum monthly balance, or minimum opening balance.

Signs You Need an Apple Savings Account

We don’t recommend Apple’s new savings account if you struggle with paying off your credit card balances every month. Plenty of credit cards with lower interest rates and higher rewards or cash-back offers are better than the Apple Card if you expect to carry a balance.

If you’re not particularly dialed into your finances, Apple’s new savings account may be an excellent vehicle for you to start paying attention! The iPhone’s Wallet application integrates Apple’s savings account, Apple Credit Card, Apple Cash, other credit cards, and other banking sources into a single application.

All of the data flowing together into a single user report has the potential to be a real eye-opener about how you spend your cash. Power credit card users that routinely shop at Apple, Ace, T-Mobile, Nike, Uber, Uber Eats, Panera, Walgreens, Exxon, or Mobil will be warmly rewarded with a 3% cash-back on all purchases.

If you don’t regularly shop at these merchants, are you willing to switch to them? These merchants are the cash-back honey pot. If you’re unwilling to use them, you’ll lose the maximum Apple Card cash-back to your Apple savings account.

Users willing to make every single purchase they possibly can with the Apple Card will be rewarded with a 2% cash reward deposited into their savings account.

5 Best Benefits of Apple’s New Savings Account

1. The 4.15% interest rate is nothing to sneeze at!
2. No fees, ever.
3. No minimum balance is required.
4. The iPhone’s Wallet application merges all financial data into a single report.
5. Three percent cash back on select purchases. 

Wrapping Up

Separating the Apple Card (credit card) from Apple’s new savings account isn’t possible. To open Apple’s savings account, you must have an Apple credit card. If you struggle with credit card debt or paying off your credit card each month, the act of opening another credit card isn’t advised.

If your credit card spending is under control, Apple’s new savings account has a reasonable 4.15% APY. It’s not the best high-yield savings account rate in the marketplace, but neither is it the worst rate.

Inevitably, there are discussions about the ease of financial transactions with Apple’s new savings account. We reason that too much access to a savings account too quickly diminishes the fundamental purpose of a savings account, which is to save money for a rainy day, a future purchase, etc.

We believe that funds should be available within a few financial business days, but we don’t think we need immediate daily access to extract cash to head to the movies or go shopping.

If you require instant access to your savings account in the form of cash from an ATM, Apple’s new savings account may not be an excellent fit for you. If you’re comfortable with a bit of a lag between the savings account transfer request and transfer fulfillment from the savings account to an external banking source, you should be pleased with Apple’s savings account.

Frequently Asked Questions

Does Apple have a savings account?

Yes, Apple has a savings account. Apple has teamed up with Goldman Sachs to provide savings accounts for users of the Apple Card. The Apple Card is Apple’s credit card. To open an Apple savings account, you must first apply for, and be accepted, to use an Apple Card.

Is Apple's savings account good?

The Apple savings account is good if you’re accustomed to monthly paying off your credit card debt. If you carry credit card debt from month to month, there are other credit cards with lower interest rates.

What is the interest rate of the Apple savings account?

The Apple savings account pays 4.15% APY. The Apple saving account is a “mid-pack” for high-yield interest savings accounts.

How safe is Apple Bank for savings?

The Federal Deposit Insurance Corporation (FDIC) insures Apple savings accounts for up to $250,000.

Can you withdraw money from Apple savings?

Yes, but it’s slightly different from a brick-and-mortar bank. You’ll need to generate the fund’s transfer from the Apple savings account to your linked financial institution (a separate checking or savings account).

When the funds have reached the secondary account, you can use them to pay electronic bills or withdraw cash. Apple limits their savings account clients from withdrawing more than $20,000 in a seven-day rolling window.

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