Bank Accounts

Capital One 360 Review: Checking and Savings Accounts

e_banking keyboardThe bank that’s probably best known for their credit cards has now branched out into providing a comprehensive and convenient online and mobile banking platform that offers a range of checking and savings accounts for consumers of all ages, including those young as 10 years old. This burgeoning banking platform is still making its way into the market and attracting customers with perks that are both exclusive to the institution and practiced industry-wide.

Capital One 360 was born from the previous online banking portal ING Direct when the company took it over back in 2013. Since then, Capital One has worked to streamline what was already a pretty great banking experience by re-branding it as 360 and offering consumer’s accounts without minimums or hidden fee along with mobile deposits and ATM access at 38,000 Allpoint ATMs (none of which will charge a fee for completing a transaction since there are only 2,000 Capital One machines in the country).

The ease of use doesn’t end there, either: Capital One 360 offers a litany of other banking products that you won’t find at many other online and mobile banking institutions and they are all backed by the full faith and credit of the United States government through the Federal Deposit Insurance Corporation (FDIC). But is it the right fit for you and your banking needs? Take a look at our extensive review as we delineate the pros from the cons and examine all of the many features and products that Capital One 360 makes available to its clientele 24/7.

Why Capital One 360?

The name alone is indicative of the round-the-clock availability to access everything this bank offers through its online and mobile platforms. Technology is the defining engine that helps Capital One 360 operate so smoothly for customers. They’ve taken what was already advantageous of ING Direct in the convenience department and further simplified the user interface by developing a much easier log-in process and tinkering with the mobile app to make it faster and more helpful to customers.

The mobile app has been one of the highest rated in the industry for this reason alone and you can access all of your accounts – checking, saving, CD’s, whatever else you may need – and it even allows you the power to set up sub-accounts within each one to help you allocate and save money for certain specific goals.

Trying to save up for the down payment on that new car or build a fund for that vacation you really want to take later this year? You can assign nicknames to your sub-accounts expressly for those purposes, that way you can put aside a little or a lot of money as you work towards achieving your goals, without it commingling with the rest of your assets. Because, let’s face it, it’s easier to save when that money has been assigned a specific purpose and not just a part of your current balance. This may not be a new idea for those already proficient with a household budget, but you can currently mainly find this feature mostly with credit unions instead of larger banking conglomerates. The app also works in conjunction with Capital One’s handy little budgeting tool which can help you keep an eye on your spending routines and purchases in real time.

You may be wondering about speaking with a customer service representative since there are so many options available to you online, but while you do have Twitter as one of your methods of contact, they also provide options to contact customer service via telephone and email as well. Unfortunately, there is no chat function on either the online or mobile versions of Capital One 360.

But perhaps the most intriguing part of the 2013 changeover from ING Direct is that Capital One kept the former company’s old coffeehouse/banking centers intact. These were much the same as your typical Starbucks offering free Wi-Fi, public iPads, and a full menu of coffee drinks while you conduct banking transactions at the cafe’s automatic and in-person tellers. It’s your one stop shop for a chai latte and a checking account!

Consumer Friendly Accounts

Fee-free checking is just the start of all of the great benefits that Capital One 360 provides its customers. Their major offerings are checking accounts that come with no account maintenance fees, no minimums, and they can provide a debit card which Capital One 360 is happy to issue when you open an account. There are two types, the standard checking that all consumers can enjoy and a “teen” checking account, geared towards younger customers age 13 and above. The company provides this type of account to help kids start to learn the value of a dollar and introduce them to checking account ownership and savings to better prepare them for financial responsibility in adulthood.

Capital One 360 checking accounts may be a much smarter option for many consumers because they don’t come with some of the infuriating components that are often found with accounts from the typical banks. For example, Capital One 360 won’t charge you overdraft fees in case you overdraw from your account by mistake. That is, they won’t charge the same amount in fees as the other banks will, but rather they offer you two different forms of overdraft protection. The first method lets you connect a savings account to your checking, which instantly pays off the overdraft as long as that account has enough funds to cover the difference.

The second, and somewhat more unique form of protection, comes in an overdraft line of credit which comes with an APR of 11.50%. The way it works is that you only pay interest on the amount of money that you are borrowing from the line which is equal to the amount of your overdraft. But instead of paying fees in the range of $30-35 per overdraft as is the case with other banks, you could be paying much less on the interest until the amount is paid back to your credit line. It could be as little as pennies on the dollar for every day you’re overdrawn. That’s far more attractive than shelling out the alternative.

In addition, you also get the benefits of mobile check deposit through the Checkmate feature for your smartphone, free online bill pay, and you can earn interest on your checking account balance. On the negative side, the rates aren’t all that impressive, with 0.20% APY for balances up to $50,000, 0.75% APY for anything up to $100,000, and the more attractive 0.90% APY on balances exceeding $100,000. You can even get a checkbook for free, if you would rather do things old school. Any checks after your first batch are subject to a charge, however.

Capital One 360 also offers three types of savings accounts: personal, business, and another kid-friendly option that is geared toward getting the little ones well acquainted with money management from an even earlier age than 13. These options come with many of the same perks and benefits of their checking accounts – no fees, no minimums, 24/7 access to your money anytime, mobile check deposit, and automatic bill pay. The biggest difference is in the interest rate, currently 0.75% APY which is well above the national average on savings accounts at the other banks. You can also open up to 25 different savings accounts, each one devoted to a separate savings goal, all of them free of maintenance fees and the other hindrances that other banks like to add to their accounts.

little girl piggy bankAbout Those Kids Accounts

The checking and savings accounts aimed at getting kids and teens into the habit of saving are two great features that most other banks don’t offer their customers. These accounts are designed to bring a component of fun to a serious subject of fiscal responsibility and smart money management. For both accounts, there are no fees, no minimum balance or age requirements, and they earn interest on the money saved. The savings account offers a 0.75% variable APY and kids have their own sign-in info and they can also play with budgeting tools that are designed for children to easily understand and use.

The checking account branded as MONEY Teen Checking is better suited for teens than younger kids because it provides a much more realistic feel for ownership of an actual checking account. The balance in the account also builds interest but it’s less than the savings account at a variable 0.25% APY. Deposits can be made through the mobile app on your teen’s smartphone and they will even be issued a MasterCard debit card for making purchases and withdrawals from thousands of ATM’s. Every transaction comes with a notification alert which parents can monitor to keep their teen on the right track for conscientious fiscal governance. Parents can also stay up to date on all the action on their kids’ accounts through the mobile app.

But Wait, There’s More

Checking and savings accounts are not the only reasons you will want to be a part of Capital One 360. They offer a variety of other banking products that are exclusive to Capital One 360 and some other services that are backed by Capital One to provide customers with a wide array of options.

Capital One 360 offers Certificates of Deposit (CD’s) with nine different terms starting with six months at 0.40% APY all the way to sixty at an APY of 1.70%. These CDs work the same as they do at any other bank –  you will get penalized for early withdrawal and you can choose to have interest payments made monthly, annually, or in one lump sum when the term comes to an end. Capital One 360 gives you a 35 day warning before CD’s mature and they will automatically renew at the same period when the previous term reaches conclusion. There are no minimum deposit restrictions and terms and rates are competitive with other banks on the market.

Capital One 360 also offers investment options through their online and mobile portals for customers who want to create a portfolio that includes stocks, exchange traded funds (ETF’s), mutual funds, even investment retirement accounts (IRA’s). If you’re looking for a mortgage solution, Capital One 360 offers both fixed and adjustable rate choices at interest rates that are commensurate with the national average among most banks.

What 360 can’t or doesn’t offer, the parent company of Capital One is able to provide to customers.  This is where you can get access to additional financial products such as auto loans, credit cards, and banking methods that have been designed for business and commercial banking. With so many choices, Capital One has everything covered. . . with the exception of offering personal loans. For those, you will need to look elsewhere.

A Few Drawbacks to Capital One 360

Despite all of these great offers and perks to going with Capital One 360 for your mobile and online banking needs, there are a few limits and drawbacks that some consumers will want to weight against all of the positives thus far. First and foremost, there is a daily deposit limit of $5,000 which can put a real hindrance on conducting transactions and if you thought that was sort of a bummer, then you may really have an issue with Capital One 360’s monthly limit of $10,000. This might turn off some potential customers who deal with large sums of money at a time, particularly if they had hoped to make those deposits from the mobile app.

Oh, and about that Checkmate feature…it can be more than a bit temperamental, with customers reporting that they have had to take a few snapshots of their checks before they were visible enough to be submitted. This can be a hassle, of course.

If you prefer to do your banking the traditional way – in a branch talking with a personal banker or account manager – then you’re mostly out of luck with Capital One 360 as well. There are only 11 cafes offering face-to-face time with associates across the country so unless you live in one of those major metropolitan regions then you’ll have to rely on virtual customer care.

How to Join

Opening up a checking or savings account with Capital One 360 is relatively simple. Just supply them with your pertinent basic information such as your name, your address, date of birth, and your Social Security number. Then they will ask you to link an active checking account so you can deposit funds into your new Capital One 360 account. You can connect up to three accounts to any one checking or savings account, all it takes is the account number and routing number, and then the bank will need you to verify you own these existing accounts by accepting two small deposits made from Capital One 360 into the account or accounts you’ve chosen to link up. Upon opening a savings account your initial deposited funds will be put on a 10 day hold for security reasons. But all other deposits after that are subject to up to a five business day hold before the funds are made available to you. For checking accounts, the hold is two business days which is the norm for most banking institutions, however, the funds may be available sooner in some cases such as with direct deposits. These are often accessible in your account in less time.

atm cell phoneMaking Deposits

So you’ve decided that the $5,000 daily and $10,000 monthly deposit limits aren’t a problem and you’ve opened an account with Capital One 360. You’ve gone through the initial account link-ups and verified ownership and your initial hold period has passed. Now you want to use the account by making some routine deposits into it and, for that, you have a number of choices from which to choose.

We’ve already mentioned the Checkmate feature on the mobile app, where you just snap a pic and submit it to the bank. There is also the direct deposit method where your paycheck is instantly sent directly to your account on pay day. This is also super simple and it doesn’t require anything more than giving your employer your checking account and routing numbers. You can also set up direct deposit through Capital One 360’s easy online form.

The third and final method might come as a surprise to some, since this is a fully digital online and mobile banking platform you may not expect to have the ability to deposit a good old-fashioned check without taking a photo of it first. But you can send your check to Capital One 360 through the mail and deposit funds that way as well.

Our Final Thoughts

The multitude of options that Capital One 360 offers make it worth your while to check it out in full. This review has only scratched the surface of all the great benefits to banking with this online and mobile portal. Once you sign up you have access to all of the services that come from Capital One and the 360 brand, so for those who find their current bank a bit lacking in the versatility department, this may just be the welcome change you’re looking for right now.

Another major selling point is the lack of overdraft fees that come with their checking accounts. If you are someone who has a tendency to overspend on more than one or two occasions and you’ve been whacked for that $35 fee each time, then this may be the time to consider moving your money from your current bank to Capital One 360.

What really makes an account here worthwhile is the many ways in which you can bank. While there are the obvious online and mobile options available, both of them well-designed and user friendly, the additional Capital One 360 cafes are just sweetening the deal. There you can talk to a real live human being about your finances or open an account while you sip a hot coffee and enjoy the free Wi-Fi.

But while there are many upsides to banking with Capital One 360, it’s not all positive and some consumers may want to consider some of the potential disadvantages that they might experience with this platform. The company doesn’t offer the best interest rates among prominent online banking entities. Though their rates are competitive with conventional banks, the many online choices such as Ally Bank or Everbank offer better rates for a higher annual yield with rates approaching 1% or higher.

In addition, although they’re called Capital One 360 and offer online and mobile banking at any hour of the day or night, the bank’s customer service department is not as accessible. As mentioned earlier, Twitter, email, and the phone are the only three ways in which to contact a representative at Capital One 360. Unfortunately, if you have a question or concern about your account at 2am in the morning that issue is going to have to wait until normal business hours. Some banks offer 24 hour customer support, but not Capital One 360.

Don’t expect to have your money available immediately, either, with wait times for checks to clear running about five days for savings and two days for checking. Though, like most banks, Capital One 360 does allow for the partial release of your funds when they are deposited but you’ll still have to wait those two days for the rest to become available. This can be frustrating for some customers because they simply don’t want to wait for their money. Many of them get around this with direct deposit, but that’s an extra step that not every consumer wants to take nor does every employer readily offer a direct deposit method of paying their workforce.

So take these all into account before you decide whether you want to open an account with Capital One 360. One last thing you should know, the company is offering new customers an incentive of up to $500 for starting a checking or savings account and keeping a qualifying balance in it for a duration of 90 days. So if you want to get in on that deal, be sure you sign up by 11.30.2016 before the offer expires.

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