Is Online Riskier?
How can you tell if an online money market account is a good deal, or if it is a scam?
QUESTION: Sean wants to do an online money market account because it has a higher interest rate. Is this legitimate, and is there any more risk to that than a traditional or local bank?
ANSWER: Not because it’s online, but because the firm might be risky. If they have a brick and mortar place somewhere or are FDIC insured, then you’re probably all right, but check on them. Do a Google search or them and do some checking up. My guess is that if they are an FDIC insured bank, then you’re probably all right. But check up on them. There are some Internet-only banks out there that I would not put money with simply because they are not strong.