No longer do you need to drive down to your local brick-and-mortar bank to set and manage a savings account. Online deposit accounts are abundant these days, and regulated just as fiercely as their land-based counterparts. An online deposit account allows you to access and manage your money over the internet.

With online deposit accounts you can check up on your balances, review past transactions, you can make direct deposits, pay bills, transfer money to and from other accounts, and institute standing orders – all from the comfort of home. And with the added convenience comes no sacrifice in services or interest rate. You can still expect top notch service and competitive interest rates from online deposit accounts just as much as any your accounts at offline banks. Some accounts even offer cash debit cards and other special benefits. You just need to search to find all the deals available to you.

Primarily, online deposit accounts come in 4 different forms: Notice, No Notice, Easy Access Accounts, or Monthly Income Accounts.

Notice Online Deposit Accounts
Notice accounts require that the account holder wait a predetermined period before withdrawing each amount deposited or else get saddled with a penalty (ie. loss of interest). Depending on the account you select, the amount of notice that must be given varies.

If the higher interest rate on a Notice Account appeals to you over the lower rate of the easier-access No Notice accounts, then at least try to find an account that allows you a select number of withdrawals penalty-free each year. That way, you have a safety net should an emergency arise, so you can get at your money without worrying about incurring penalties. Having money for emergencies is – after all -- what deposit accounts are all about to many people, aren’t they?

No Notice Online Deposit Accounts
No Notice accounts allow you to withdraw funds whenever you want, without penalty, without requiring you first give notice. Before getting excited about the first No Notice account you see, however, there are several factors to keep an eye out for, most notably: opening restrictions (only people fitting certain criteria are eligible), minimum balance requirements, number of withdrawals permitted – and on the positive side – rate guarantees, and conditional and unconditional bonuses.

Easy Access Deposit Accounts
Easy Access accounts are great compromise if you don’t want to wait long periods to access your money but still want to receive a competitive rate of return. The notice period on Easy Access accounts is much shorter than Notice accounts (usually just a few days). And the interest rates on Easy Access accounts, while not as high as on Notice accounts, are higher at least than that of No Notice accounts.

Monthly Income Online Deposit Accounts
Monthly Income accounts can be either Notice or No Notice accounts. Interest is paid monthly, as opposed to annually or upon the account’s maturity. If what you are looking for is a consistent income derived from the payment of interest on the money you save, then this option – the Monthly Income account -- may suit you well.

Lastly, Term and Bond Accounts are also a savings vehicle worth looking into, but only if you can afford to be without the money you’re saving for a year or longer. The benefit? Generally much higher rates of interest. The downside? Nasty penalties for pulling your money out prematurely. The bottom line: Just use the same discretion in choosing a term account or bond account as you would with any other deposit account.