Did you know that Capital One launched a brand new online savings account called 360 Performance Savings?
I sure didn't!
Unfortunately, it's not a particularly exciting new account.
I have a few accounts with Capital One Bank but they all were legacy ING Direct accounts. Capital One acquired ING Direct back in 2012 and I just kept going along with it. I was tempted to close them when I went through a big personal finance simplification phase, but I continued to use one as a bank account firewall with PayPal. It served a purpose, paid a competitive interest rate, so I left it alone.
When Capital One acquired ING Direct, all existing ING Direct accounts were converted to 360 Checking and 360 Savings accounts. For years, nothing substantial else changed.
But now that Capital One has a new banking product, it's time to pay a little bit more attention.
What is Capital One 360 Performance Savings?
It's Capital One's new name for their high-yield, no-fee online savings account. You get an interest rate of 1.80% APY with no minimums. Your funds are FDIC insured up to $250,000, there's a mobile app, and you can open it online in just a few minutes. It's a pretty run of the mill online savings account.
When Capital One started offering this “new” type of account, they took away their 360 Savings Accounts and 360 Money Market Accounts. It's now Performance Savings only.
If you're an existing Capital One 360 Savings customer, it's pretty much the same as before except you get a higher interest rate. The Performance Savings pays 1.80% APY.
Money market accounts have been falling out of favor in the last decade or so. In the past, they were useful because you could earn a higher interest rate and still have more than six transactions/transfers per month. Nowadays, with online banking and credit cards, there really isn't a useful place for your traditional money market account. It's no surprise that Capital One did away with it.
How to Convert Your Account from 360 Savings to Performance Savings
There doesn't appear to be a single button you press to convert an existing 360 Savings Account into a Performance Savings account.
You will have open a new Performance Savings account, transfer all of your funds from the 360 Savings to the Performance Savings, and then close your 360 Savings account.
Fortunately, opening a new account is simple, takes about five minutes, and I was able to do it all in about five minutes. Capital One prepopulates most of your information and you just have to enter in employment title, salary, and check off a few disclosure statements. You can even do it on a weekend (I did it on a Sunday).
Presto – nearly double the APY. It's not going to be a ton of money but it's like picking up a quarter on the sidewalk.
How to Close Your Account Online
Peter from Bible Money Matters showed me how to close your account online.
First, log into your account as normal… then visit this link to access the old interface:
(copy and paste it in the browser after you log in)
Then click on your account name in the list, followed by “Account Details” tab underneath your Routing Number and Account number. The site defaults to your list of transactions.
Then click on “Close your account” at the bottom:
There's a confirmation screen but then you're done:
Alternatively, you can call customer service to close your account. In the past, I've had success using the online chat to close an account too.
Should You Open This Account?
If you don't have an existing Capital One 360 Savings account, does it make sense to open a 360 Performance Savings?
The interest rate is competitive but I don't feel like there's a ton of added value with this account. For example, if you open an Ally Bank account, you get a 1.70% APY interest rate plus the ability to link up an Ally Invest account. Ally Invest is a brokerage account that gives you free trades on all U.S. stocks, ETFs, and options. (they also run cash bonuses for new brokerage accounts)
SoFi Money is a cash management account that pays 1.60% APY but also has SoFi Invest, another no commission stock brokerage. They'll also give you $50 when you deposit $100, no strings attached.
I've always been a fan of how convenient it is to open accounts and manage savings goals with Capital One but I'm not sure it's a good option if you're opening a new account.