Money Analysed

Maximize Your Savings with Varo’s High-Interest Fee-Free Savings Account

Varo Savings Account Basics

If you’re looking for a savings account with a great interest rate and no fees, then the Varo Savings Account might be the right choice for you. Here’s what you need to know about this account:

APY and Requirements

The Varo Savings Account offers a competitive Annual Percentage Yield (APY) of up to 2.80%. This rate is variable and is subject to change, but it’s higher than most traditional banks.

In order to open a Varo Savings Account, you need to meet certain requirements. First, you must be a U.S. citizen or permanent resident with a valid Social Security number.

You also need to be at least 18 years old and have a valid government-issued ID. Finally, you need to have a Varo Bank Account, which is free to open.

You can do this by downloading the Varo Bank app on your mobile device and completing the application process.

Account Balance and Deposit

One of the best things about the Varo Savings Account is that there is no minimum balance requirement. This means that you can open this account with as little as $0 and still earn interest on your savings.

The Varo Savings Account also allows you to make unlimited deposits at any time. This means that you can add money to your account whenever it’s convenient for you.

Fees and ATM Access

Another great feature of the Varo Savings Account is that there are no fees. This means that you won’t be charged for things like monthly maintenance fees, overdraft fees, or foreign transaction fees.

Varo Bank is also part of the Allpoint ATM network, which means that you can access over 55,000 surcharge-free ATMs worldwide. This includes ATMs located in popular retailers like Target, CVS, and Walgreens.

What We Like About Varo Savings Account

No Minimum Balance and Great Interest Rate

We love that the Varo Savings Account doesn’t require a minimum balance. This makes saving money accessible to everyone, no matter how much or how little you can afford to save.

We’re also impressed with the 2.80% APY offered by the Varo Savings Account. This is much higher than most traditional banks, which usually offer an APY of less than 1%.

Automated Savings Option

If you’re not the best at saving money, then the Varo Savings Account can help. They offer an automated savings tool that helps you save money effortlessly.

With this feature, you can set up automatic transfers from your Varo Bank Account to your Varo Savings Account. You can choose the amount and frequency of these transfers, and Varo will take care of the rest.

Easy

Funding Options

Varo Bank makes it easy to fund your Varo Savings Account. You can transfer money from another bank account, set up direct deposit, or deposit a check using your mobile device.

Overall, the Varo Savings Account is a great option for anyone looking to save money without worrying about fees or minimum balances. With a great interest rate and helpful features like automated savings, it’s worth considering if you’re in the market for a new savings account.

What Varo Savings Account Could Improve

While the Varo Savings Account is a great option for many people, there are a few areas where it could use some improvement.

Requirement for Varo Bank Account

One of the drawbacks of the Varo Savings Account is that you need to have a Varo Bank Account in order to open a savings account. This can be inconvenient for people who prefer to keep all of their banking in one place.

While it’s free and easy to open a Varo Bank Account, this added step could be a turn-off for some people. It would be nice if Varo offered the option to open a savings account without needing to also have a checking account.

Limitations for Big Savers

If you’re someone who likes to save a lot of money, you may find the Varo Savings Account limiting. While there is no minimum balance required, there is a maximum balance limit of $5,000.

This means that if you have more than $5,000 to save, you’ll need to find another savings account or split your money between multiple accounts. It would be great if Varo offered a higher maximum balance limit for big savers.

Additional Requirements for Best Interest Rate

While the Varo Savings Account boasts an impressive APY of up to 2.80%, there are some additional requirements you need to meet in order to earn this rate. Namely, you need to meet certain monthly spending and direct deposit requirements.

To earn the best interest rate, you need to have at least one direct deposit of $1,000 or more per statement period and make a minimum of five debit card purchases per statement period. While this shouldn’t be too difficult for most people, it’s important to keep in mind if you’re aiming for the highest possible APY.

Compare Earnings with Varo Savings Account vs. Traditional Savings Account

If you’re trying to decide between the Varo Savings Account and a traditional savings account, it’s important to compare the potential earnings.

Let’s take a look at an example to see how the two accounts stack up:

Suppose you have $5,000 to save and you plan to keep this money in a savings account for one year. If you were to put this money in a traditional savings account with an APY of 0.50%, you would earn $25 in interest over the course of the year.

However, if you were to put this money in a Varo Savings Account and meet the monthly spending and direct deposit requirements to earn the best interest rate of 2.80%, you would earn $140 in interest over the course of the year. That’s a difference of $115, which is significant.

While it’s worth noting that the interest rate on the Varo Savings Account is variable and subject to change, it’s clear that it has the potential to earn you significantly more money than a traditional savings account. In summary, while the Varo Savings Account is a great option for many people, there are a few areas where it could use improvement.

It would be nice if Varo offered the option to open a savings account without needing to also have a checking account and a higher maximum balance limit for big savers. Additionally, there are some additional requirements you need to meet in order to earn the best interest rate, so keep this in mind when deciding if the Varo Savings Account is right for you.

How to Open a Varo Savings Account

Opening a Varo Savings Account is a quick and easy process that can be done entirely online. Here’s what you need to know:

Account Opening Process and Identity Verification

To open a Varo Savings Account, you’ll need to download the Varo Bank app and complete the application process. You’ll be asked to provide some basic information, such as your name, address, and Social Security number.

Once you’ve submitted your application, Varo will need to verify your identity. This process can be done online and usually takes just a few minutes.

Sometimes Varo may require additional documentation to verify your identity, such as a driver’s license or passport.

Funding Options

Once your identity has been verified, you’ll be asked to fund your Varo Savings Account. There are several ways to do this:

1.

Transfer money from another bank account: You can link another bank account to your Varo Savings Account and transfer money electronically. 2.

Direct deposit: You can set up direct deposit with your employer or other income source. 3.

Mobile check deposit: You can deposit a check using your mobile device and the Varo Bank app. 4.

Wire transfer: You can wire money directly into your Varo Savings Account. Once your account is funded, you’ll start earning interest right away.

How to Withdraw Money from Varo Savings Account

Withdrawing money from your Varo Savings Account is not as straightforward as depositing money, but it’s still relatively easy. Here’s what you need to know:

Limited Withdrawal Options

The Varo Savings Account is designed to be a long-term savings account, so there are some limitations on how often you can withdraw money. Specifically, you are limited to six “convenient” transactions per statement period.

This includes things like transfers to your Varo Bank Account, transfers to other bank accounts, and bill payments. If you need to withdraw money more frequently, you’ll need to do so via an ACH transfer to another bank account.

You can also use an ATM to withdraw money, but keep in mind that you’ll be limited to the Allpoint ATM network to avoid fees. To initiate an ACH transfer, you’ll need to link another bank account to your Varo Savings Account.

Once this account is linked, you can transfer money electronically at any time. Just be aware that these transfers can take a few days to process.

In summary, opening a Varo Savings Account is a quick and easy process that can be done entirely online. Once your account is open and funded, you’ll start earning interest right away.

Withdrawing money from your Varo Savings Account is limited to six “convenient” transactions per statement period, so keep this in mind when deciding how much money to keep in your account. If you need to withdraw money more frequently, you can do so via an ACH transfer to another bank account or an ATM withdrawal.

Other Varo Savings Account Fees

While the Varo Savings Account doesn’t have any monthly maintenance fees, there are a few other fees to be aware of.

Overdraft and Stop Payment Fee

If you have a Varo Bank Account linked to your Varo Savings Account, you may be subject to overdraft fees if you overdraw your account. The fee for overdrafts is $25 per item, up to a maximum of three items per day.

However, Varo does offer a “No Fee Overdraft” program that allows you to overdraw your account without incurring fees as long as you pay the negative balance back within a certain timeframe. If you need to stop payment on a check or ACH transfer, Varo charges a stop payment fee of $15 per transaction.

This fee is waived for customers who have a Varo Bank Account with a qualifying direct deposit.

ACH Transfers and Wire Transfer

While there are no fees for ACH transfers to and from your Varo Savings Account, there is a fee for wire transfers. The fee for incoming domestic wire transfers is $15, while the fee for outgoing domestic wire transfers is $25.

Varo Customer Service

Varo Bank offers a few ways to get in touch with customer service if you have questions or concerns about your account.

Contact Methods

The easiest way to get in touch with Varo is through their app or website. You can find answers to frequently asked questions or send a message to customer support through the app or website.

Varo also offers phone support, which is available Monday-Friday from 8am-9pm Eastern Time and Saturday-Sunday from 11am-7pm Eastern Time.

BBB Rating and Safety

Varo Bank has a BBB (Better Business Bureau) rating of A+, which indicates a high level of customer satisfaction. Varo is also FDIC insured, which means that your deposits up to $250,000 are protected if the bank were to fail.

In addition to being FDIC insured, Varo takes other measures to ensure the safety and security of their customers’ accounts. This includes using industry-standard encryption and multifactor authentication to protect your personal and financial information.

In summary, while the Varo Savings Account doesn’t have any monthly maintenance fees, there are a few other fees to be aware of, such as overdraft fees and stop payment fees. Varo offers several ways to get in touch with customer service, including through their app, website, and phone support.

Varo has a BBB rating of A+ and is FDIC insured, making them a safe and reliable place to store your savings.

Common Questions About Varo Savings Account

If you’re considering opening a Varo Savings Account, you likely have some questions about the account and how it works. Here are some common questions and answers to help you decide if a Varo Savings Account is right for you.

Varo Bank Safety

One of the most important things to consider when choosing a bank is safety. Varo Bank takes customer safety seriously and employs measures such as multi-factor authentication and encryption to protect customer data.

Additionally, Varo Bank is FDIC-insured, so your deposits are protected up to $250,000.

Joint Account Availability

If you want to open a joint savings account with a partner or family member, Varo offers the option to open a joint account. To open a joint savings account, both parties need to meet the eligibility requirements and complete the application process.

Cash Deposits

One of the limitations of the Varo Savings Account is that you cannot deposit cash directly into your account. Instead, you’ll need to deposit cash into another account and then transfer the funds to your Varo Savings Account using ACH or mobile check deposit.

Monthly Fees

One of the advantages of the Varo Savings Account is that there are no monthly maintenance fees. However, there are some other fees to be aware of, such as overdraft fees and stop payment fees.

Compatibility with Venmo

Varo Bank is compatible with Venmo, so you can link your Varo Bank debit card to your Venmo account and use it to send and receive money.

Comparison with Other Banks

Compared to traditional brick-and-mortar banks, the Varo Savings Account has several advantages, such as no monthly maintenance fees and a higher interest rate. However, it’s important to compare the fees and features of different savings accounts to determine which one is right for you.

Mobile App Limitations

While the Varo Bank app is a convenient way to manage your savings account, there are some limitations to be aware of. For example, some users have reported issues with the app crashing or freezing, and the mobile check deposit feature may not work for everyone.

Value of Varo Bank and Savings Account

Overall, the Varo Savings Account is a great option for those looking for a fee-free and easy-to-use savings account. With a competitive interest rate and helpful automation features, it’s a great way to save money.

The Varo Bank app also makes managing your account simple and convenient. However, it’s important to weigh the pros and cons and compare it to other options before deciding if a Varo Savings Account is right for you.

In summary, the Varo Savings Account is a great option for those looking to save money with a high interest rate and no monthly fees, but with some limitations such as limited withdrawal options, the need for a Varo Bank Account, and additional requirements to earn the best interest rate. It offers helpful features such as automated savings and easy funding options, and Varo Bank also takes customer safety seriously.

It’s important to compare the pros and cons and consider the value of the account when compared to other savings accounts. Ultimately, the Varo Savings Account is a convenient and worthwhile option for those looking to start saving money for the future.

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