About USAA
The following is a review of the savings accounts offered from USAA Federal Savings Bank. For those who may be unfamiliar with USAA,
they are based in San Antonio, Texas, and offer rich selection of banking,
investment, retirement,
and insurance products to qualifying persons. USAA’s website states,
“USAA membership is open to U.S. military service members, veterans with an honorable discharge, and their eligible family members.
We also offer some products to individuals with no military affiliation.”
USAA Savings Account
USAA offers two types of savings accounts, the most basic of which is called USAA Savings. Opening this account takes a minimum of $25,
literally a few minutes of a person’s time, and there is no monthly minimum balance to worry about maintaining. Anyone wondering about
how much it costs to maintain this account would be pleased to learn that there are no monthly or annual fees associated with this account.
Imagine that, a bank that does not charge a person to take care of or access their own money!
Most savings accounts have abysmal interest rates. In fact, the national average Annual Percentage Rate for a savings account is 0.07%!
It flat out does a person no good to sock money away in a savings account that pays such a low rate of return. The rates of return for
this account begin at 0.05% and rise at a graduated rate up to 0.15% for accounts holding over $25,000.
| Daily Balance |
Annual Percentage Yield (APY) |
|---|
| $0 - $999 |
0.05% |
| $1,000 - $4,999 |
0.05% |
| $5,000 - $9,999 |
0.10% |
| $10,000 - $24,999 |
0.15% |
| $25,000+ |
0.15% |
USAA Performance First Savings Account
The second type of savings account offered by USAA is called the USAA Performance First Savings. This account takes a minimum of $10,000
to open, again requires no minimum monthly balance, also has no associated monthly or annual fees, and features a graduated APR ranging
from 0.05% to 0.30% for accounts with a balance over $50,000.
| Daily Balance |
Annual Percentage Yield (APY) |
|---|
| $0 - $9,999 |
0.05% |
| $10,000 - $24,999 |
0.20% |
| $25,000 - $49,999 |
0.25% |
| $50,000+ |
0.30% |
USAA Savings Account Pros
Convenience and customer service are mainstays of how USAA continually ranks among the highest rated banks in surveys ranging from customer
service, banking accounts, and insurance products. J.D Power and Associates awarded USAA the title of “Customer Service Champion”.
Examples of the extreme convenience members have come to expect include more than 60,000 ATMs located within the USAA preferred network,
no fees associated with using the preferred ATMs, transferring funds to any bank in the United States from the preferred ATMs, and refunds of up
to $15 per month for ATM charges incurred when using ATMs outside of USAA’s preferred network. USAA also boasts a robust mobile application,
designed for those who want to complete most any needed banking transaction from their phone. One is able to instantly transfer funds between
accounts, check deposit via mobile and desktop, view transaction history, and many other options.
For those who are not able to use a smartphone to deposit checks, USAA has partnered with approximately 2,000 UPS store locations nationwide.
These locations have deposit envelopes on hand, and are able to assist the customer if they have questions about using the service. Other
features USAA members benefit from are a user-friendly financial planning tool on the website, and postage-paid deposit envelopes which are
mailed to the member’s home address after the account is opened.
USAA Savings Account Cons
Like anything in life, banking with USAA is not a perfect financial relationship. First, there is only one USAA bank branch, which is
located in San Antonio, Texas. There are USAA Financial Centers scattered around the United States, but those are not banking locations
where a member could make withdraws or deposits with a bank teller. The Financial Centers have ATMs which are able to take both check
and cash deposits, process funds transfers, and are capable of processing and counting out cash withdraws of several thousand dollars at a time.
This is a good thing, because not all USAA preferred network ATMs are capable of accepting deposits at all. Another notch in the “cons”
when dealing with USAA Savings is that members are limited to only six debit card transactions per month. Now, when compared to
the “pros” column, these few issues really take a backseat to the many benefits of dealing with USAA.
USAA Customer Service
Chief on the list of benefits is the aforementioned outstanding customer service, and members are able to reach a representative
Monday through Friday from 7:30 am to 8:00 pm and Saturdays from 9:00 am to 4:00 pm. Over the phone, the representative is able to
deal with everything ranging from simply providing a member’s account number, to setting up a full-fledged retirement account.
Another great thing about USAA is their polished website which enables the member to perform nearly any function the customer
care representative can. Strangely, the Financial Centers make both the pro and con list. At the Financial Center, the member is able
to video chat with customer care specialists who are able to assist with complex account issues. The chats take place in private rooms
which feature computers, printers, paper shredders, and flat panel video screens. Few other banking institutions put so much effort into
caring for their customers or members.
USAA Comparison
Speaking of comparisons, Bank of America offers much lower APRs than does USAA for savings accounts. Plus, Bank of America accounts are subject to monthly fees if
the balance drops below a set amount. This may not be a fair comparison since the general public is not able to open accounts with USAA, so we will look at other
institutions which cater to Department of Defense personnel. First is Navy Federal Credit Union (NFCU), www.navyfederal.org/, who offers APRs both a little higher and a little lower than those of USAA. No service fees are associated with the NFCU account, but their website did not divulge if there was a minimum balance to maintain. Then there is Pentagon Federal Credit Union, www.penfed.org/HomePage.aspx, whose savings account APRs are all lower than those of USAA, except for one, and that account must maintain a balance of over $100,000. Again there are no monthly fees, but some of their accounts must maintain a minimum balance.
USAA Savings Account – Open with $25
| Daily Balance |
Annual Percentage Yield (APY) |
|---|
| $0 - $999 |
0.10% |
| $1,000 - $4,999 |
0.10% |
| $5,000 - $9,999 |
0.15% |
| $10,000 - $24,999 |
0.20% |
| $25,000+ |
0.25% |
USAA Performance First Savings – Open with $10,000
| Daily Balance |
Annual Percentage Yield (APY) |
|---|
| $0 - $9,999 |
0.10% |
| $10,000 - $24,999 |
0.25% |
| $25,000 - $49,999 |
0.30% |
| $50,000+ |
0.35% |
USAA Deposit@Home / Deposit@Mobile – Same feature available both on your personal computer and smartphone enable you to instantly deposit checks. It’s very simple to use, user-friendly, and takes less than a minute from start to finish.
Send Money – Using the latest version of the USAA Mobile App, you can use your iPhone® or Android™ smartphone to instantly and securely send money to a person or business. This feature is limited to three transactions a day with a $250 daily overall limit. Using the recipient’s phone number or email address, money is instantly deposited to their USAA account if they are a member. If they are not a USAA member, money is sent to their PayPal account at no cost or penalty, even they previously did not have a PayPal account established. For PayPal accounts not previously established, PayPal contacts the person to complete the process of creating the account.
Free funds transfers – USAA enables you to send money from your savings account to any other bank in the United States at no cost. Like all United States savings account, regulations limit the number of debit transactions to six per monthly statement cycle.
In addition to the above-listed features, USAA boasts a very user-friendly online web interface through which to conduct your banking. Their website is easy to use and I would rate its ease of navigation and functionality as above-average. One particular feature that proves useful to me is the ability to automatically setup and schedule my bill payments, affording me the ability to schedule and forget about a bill, knowing it is already set up via timed delivery. The easy-to-use interface allows you to review pending and completed payments as well as all pertinent payee information.
The single largest disadvantage you have to accept if using USAA is the lack of ability to make cash and coin deposits. Since the bank is almost entirely online,
your ability to perform in-person service is severely diminished, not making them a desirable option if you prefer walking into a building and physically interacting
with a bank employee. Realizing the personal, human touch is an aspect of banking that people still desire, USAA has made significant progress in opening several
financial centers in close proximity to major military installations, enabling members to interact with bank representatives.
If physical interaction is not essential but interacting with a person is, the customer service they offer over the phone is above reproach. Wait times, if any, are extremely reasonable, the automated phone system is easy to use, and if you desire to speak to someone right away, you can do so without jumping through endless hoops and navigating confusing menus.
Overall, since USAA is able to make significant savings by remaining an almost entirely online bank, they are able to pass those savings on to their members
through no-fee Savings accounts, competitive online savings accounts, and other banking services. Though you lack the ability in many cases to interact
face-to-face with bank employees and make cash deposits, USAA has, in my opinion, overcome that setback by offering very competitive rates and banking
services, discounted insurance, and above all, incredible customer service that enables you to accomplish your financial tasks, no matter how big or small.
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