You can open most savings accounts online in 10 to 20 minutes without visiting a branch

Online savings accounts work the same way as accounts you open in person — you deposit money, earn interest, and withdraw when you need it. The difference is that you complete the entire process on a computer or phone, from start to finish. Most banks and credit unions now let you open an account this way, and the process is faster than going to a branch because you do not have to wait for an appointment or stand in line.

The basic steps are the same everywhere: you provide personal information, verify your identity, link a funding source, and confirm your account is active. What changes is which documents you need and how long each bank takes to verify you. Some accounts are ready to use the same day. Others take one to three business days before you can deposit or withdraw money.

Key Takeaways

  • You will need a government-issued ID, your Social Security number, and proof of your current address to open an account online.
  • Most banks verify your identity by asking security questions about your credit history, which takes a few minutes and does not affect your credit score.
  • You can fund your new account by linking a checking account at another bank, transferring money from an existing account, or waiting for a wire transfer.
  • Some accounts are ready to use immediately; others require one to three business days for the bank to complete verification before you can deposit money.
  • Online-only banks often have higher interest rates than traditional banks because they have lower overhead costs.

What documents and information you need before you start

Gather these items before you begin the application. Having them ready means you will not have to stop halfway through and search for something.

You need a valid government-issued ID — a driver's license, passport, or state ID card. The bank will ask for the number and expiration date. You also need your Social Security number, which the bank uses to check your credit history and verify you are who you say you are. This check does not lower your credit score; it is called a soft inquiry and does not appear on your credit report.

You will need proof of your current address. Most banks accept a recent utility bill, lease agreement, or mortgage statement — anything dated within the last 60 to 90 days with your name and address on it. A few banks let you use a government document like a voter registration card instead. Some online banks skip this step if you link a checking account at another bank, because that account already proves your address.

Have your phone number and email address ready. The bank will send you a code to verify both before your account opens. If you plan to fund the account by transferring money from another bank, have that account number and routing number available.

The five-step process from start to account opening

Step 1: Go to the bank's website and start the application. Click the button that says "Open an Account" or "Sign Up." The bank will ask whether you want a savings account, money market account, or another type. Choose savings account. Some banks ask whether you are opening the account for yourself or as a joint account with someone else. Most online applications do not let you open a joint account in one session, so if you need a joint account, plan to add the second person after your account is open.

Step 2: Enter your personal information. The bank will ask for your name, date of birth, Social Security number, address, phone number, and email. Type carefully — if your name does not match your ID exactly, the verification step will fail and you will have to start over. Some banks ask whether you have had an account with them before. Answer honestly; the bank can see this in their system anyway.

Step 3: Verify your identity. This is where the process differs most between banks. Some banks use a service called knowledge-based authentication, which asks you five to ten questions about your credit history — things like "Which of these addresses have you lived at?" or "Which of these credit cards do you own?" You answer based on what you know is true. This takes about five minutes and is usually instant. Other banks ask you to photograph your ID with your phone or computer camera. The bank's software reads the ID and compares it to your face. This also takes a few minutes. A few banks do both. If you fail identity verification, the bank will tell you why and let you try again or call their customer service line.

Step 4: Link a funding source or choose how to fund the account. If you want to deposit money right away, tell the bank how you will send it. Most commonly, you link a checking account at another bank and transfer money electronically. This takes one to three business days. Some banks let you wire money, which is faster but costs $15 to $30. A few banks let you mail a check. If you do not want to deposit money yet, you can skip this step and fund the account later.

Step 5: Review and confirm. The bank will show you a summary of the account details — the account number, the interest rate, any fees, and the funding method you chose. Read this carefully. If something is wrong, go back and fix it. If everything looks correct, click confirm. The bank will send a confirmation email to the address you provided.

How long it takes from application to using your account

The time between clicking confirm and being able to use your account varies by bank. Some online-only banks, like Ally and Marcus, open accounts instantly. You can see your account number and routing number immediately and start using the account the same day. Other banks, including some credit unions, take one to three business days to complete their verification process. During this time, your account exists but you cannot deposit or withdraw money yet. The bank will email you when the account is fully active.

If you linked a checking account to fund your new savings account, the transfer itself takes one to three business days after your account is active. So if a bank takes two business days to verify your account, and the transfer takes two more business days, you might not see the money in your savings account for four days total. Wire transfers are faster — usually the same day or next business day — but cost money. Checks take the longest, usually five to seven business days.

If you are opening the account but not depositing money right away, you can use the account as soon as it is active. You can set up automatic transfers from your checking account, receive direct deposits, or add money later.

Differences between online banks and traditional banks with online options

Online-only banks like Ally, Marcus, and Discover have no physical branches. They handle everything by phone, email, or their website. These banks usually offer higher interest rates on savings accounts — sometimes two to three times higher than traditional banks — because they do not pay for buildings, staff, or branch operations. The tradeoff is that you cannot walk into a location if you have a problem. Customer service is by phone or chat, and it is usually available 24/7.

Traditional banks like Bank of America, Wells Fargo, and Chase have branches you can visit in person. They let you open savings accounts online, but their interest rates are usually lower than online-only banks. The advantage is that you can go to a branch if you need to deposit cash, talk to someone face-to-face, or handle a complicated issue. Credit unions also let you open accounts online, and they often have competitive interest rates and lower fees than big banks.

If you want the highest interest rate and do not mind handling everything online, choose an online-only bank. If you want the option to visit a branch or prefer to bank with a credit union, open an account with a traditional bank or credit union that offers online opening.

What to do if your application is rejected or verification fails

If the bank rejects your application, they will tell you why in an email or letter. Common reasons include a mismatch between the name on your ID and the name you entered, an incorrect Social Security number, or a problem with your address. If the reason is a typo, you can usually start a new application and enter the information correctly. If the bank says your address cannot be verified, try uploading a utility bill or lease agreement as proof.

If identity verification fails, the bank will let you try again. If you fail twice, most banks will ask you to call their customer service line and verify over the phone. A representative will ask you security questions or ask you to confirm details from your ID. This takes about 10 minutes. If you still cannot verify, the bank may deny your application. This is rare and usually happens only if there is a serious discrepancy — for example, if your ID is expired or if your name has changed and you have not updated your legal documents.

If you are rejected by one bank, you can try another. Different banks use different verification methods and have different rules. An online-only bank might reject you while a traditional bank accepts you, or vice versa. There is no penalty for applying to multiple banks.

Fees and interest rates to compare before you choose

Before you open an account, check three things: the interest rate, any monthly fees, and the minimum balance requirement.

Interest rate is what the bank pays you for keeping money in the account. Rates change constantly and vary widely. Online-only banks currently offer rates between 4% and 5% annually on savings accounts, while traditional banks often offer less than 1%. The difference matters: on $10,000, a 4.5% rate earns you $450 per year, while a 0.5% rate earns you $50. Check the bank's website for the current rate before you open the account.

Monthly fees are charges the bank takes from your account. Most online banks have no monthly fee. Some traditional banks charge $5 to $15 per month unless you keep a minimum balance or set up direct deposit. Read the fee schedule on the bank's website to see what you will be charged.

Minimum balance is the smallest amount of money you must keep in the account. Many online banks have no minimum. Some traditional banks require $100 to $500. If you cannot meet the minimum, you may be charged a fee or the account may be closed. Check this before you open the account.

Frequently Asked Questions

Can I open an account if I do not have a Social Security number?

Most banks require a Social Security number to open an account. If you are a non-citizen without a Social Security number, some banks will let you use an Individual Taxpayer Identification Number (ITIN) instead. Call the bank before you start the application to confirm they accept ITINs. Credit unions are sometimes more flexible than banks on this issue.

What if I do not have a government ID?

You will need some form of government-issued ID to open an account online. A driver's license or passport works. If you do not have either, you can go to a branch in person with a different form of ID, like a state ID card or tribal ID. Some banks may ask you to call and verify over the phone instead, but this is less common for online opening.

Can I open an account on my phone?

Yes. Most banks have mobile apps that let you open an account from your phone. The process is the same as on a computer. If the bank asks you to photograph your ID, a phone is actually easier because the camera is built in. Make sure you have good lighting when you photograph your ID so the bank's software can read it clearly.

Do I have to keep money in the account after I open it?

No. You can open an account and leave it empty. Some banks charge a fee if the balance falls below a minimum, but many online banks have no minimum balance requirement. Check the fee schedule before you open the account. You can deposit money whenever you want, even months after opening the account.

How do I close the account if I change my mind?

You can close an online savings account by logging into your account and requesting closure, or by calling the bank's customer service line. The bank will ask where you want any remaining money sent — usually to another account you own. Closing takes one to three business days. There is no penalty for closing an account, and it does not affect your credit score.