A simple and effective way to save on the short term is what a money market account is all about. Those who run in the investment circles will tell you that the money market section of a customer’s wealth portfolio should be low-risk with a corresponding return. The Synchrony Bank Money Market products offer customers exactly what they need when they sign up for the product. But how does Synchrony compare to its competitors?
About Synchrony Bank
This is not an easy bank to find history on, as the information out there is conflicting. The last information we can find dates back to 1988 when the bank was still known as Monogram Bank. In 1993 the name changed to GE Capital Consumer Card Company and in 2005 to GE Money Bank.
After various government bailouts that took place after 2009, the bank changed its name again, this time to GE Capital Retail Bank. Finally, in 2014 the bank was renamed to Synchrony Bank. Although there is history on the GE side of things, the actual financial services portion is flakey and outdated.
There is the financial performance of the bank that can be taken into account. Synchrony Bank enjoys a BBB-/F3 rating from ratings agency Fitch. This is not the best rating, however, for a bank that has a handful of products, this is not bad. They also enjoy an ‘Outlook Stable’ status. Read here for a full review on Synchrony Bank.
Who Should Opt For A Money Market Account?
This is the ideal account for those who need a bit more from their surplus cash, but don’t necessarily want to fix it up in a CD. This is also a fairly safe way to earn interest on surplus cash, as opposed to investments and stock. Therefore, it is ideal for those who don’t want a risky wealth portfolio.
Customers who aren’t too concerned about fluctuating interest rates and intend on using their funds within the short-term will find this suitable. It also works well for those who aren’t sure of their financial situation or who don’t have a sizeable emergency savings built up yet.
Furthermore, this is the ideal savings vehicle for those who want to save towards specific projects that may require interim payments. The money market works well as customers have the ability to separate their funds from their main transactional account.
Also, the money market is the ideal choice for customers who wish to set up different accounts for different savings needs. This is because there aren’t any monthly fees on the account, making it a suitable option.
Finally, customers who are new to saving will find this account to be a great choice, as there is no minimum balance required on the account. Customers can choose whether to contribute to the account regularly or once-off.
Another Money Market account that's worth a visit, is from Discover Bank.
Features of the Synchrony Bank Money Market Account
This account is very similar to the Synchrony Bank High Yield Savings Account, which we recently did a review of. Read the review here.
The most notable difference about this account is that customers don’t have to wait out those seven business days before accessing their funds. This means that customers have access to their funds when and where they need them.
The account offers competitive interest rates that are on par with some of the top money market providers in the US. The rates are variable, therefore, customers should prepare themselves for rate drops or increases.
Furthermore, the account allows easy access and customers can withdraw online, over the phone, by check, or with an ATM card.
Also, the interest rate is not tiered, therefore, customers start benefitting from the highest rate possible on the account from the first dollar.
The account provides customers with access to up to six transactions within a statement cycle, in agreement with government regulations. Furthermore, the funds are insured by the FDIC. This is for amounts up to $250,000 per depositor, per insured bank, for each ownership category.
Finally, customers are not required to maintain a minimum balance and there is no service fee charged on the account.
Read here to see how it compares to the Ally Bank Money Market.
Restrictions of the Synchrony Bank Money Market Account
Fees and Pricing
The difficulty to get the right information before opening the account is a restriction on the account already. The disclosure tab right at the bottom of the page contains all the necessary information about the account. It takes some time to work through all the paperwork, though. Eventually, when you get to the section that applies to the money market accounts, you’ll find the possible fees charged on the account, and more.
Although customers have access to the funds at will, they need to limit their transactions to six within a statement cycle. This is to comply with the regulations that govern these types of accounts.
Variable Interest Rate
The account has a variable rate, which means that for the duration of the account customers may experience fluctuations in their growth. The rate changes with market fluctuations and is therefore not guaranteed.
Not everyone who signs up for the product will necessarily qualify for it. The requirements are:
- A United States person with a valid Social Security Number.
- Over the age of eighteen, unless part of a UTMA/UGMA or guardianship account.
- Have a valid U.S. phone number and address.
Another one of the really small print items at the bottom of the screen is that the rates are only private individuals. Therefore, customers would need to enquire whether the account is suitable for trusts and businesses. If so, they may have different rates to individuals.
How to Open a Synchrony Bank Money Market Account
Opening an account is fairly simple and once customers have selected this option on the account profile page, they will need to select the options that best suit their needs.
Customers need to indicate whether they are new or existing. For the purpose of demonstration, this will be treated as a new customer registration.
This section allows customers to select their product and whether the account is joint or single.
Customers now indicate their opening deposit, which triggers the interest rate applicable to the account. Customers also indicate whether they would like access to an ATM card.
A disclosure to the customer of all the information that will be required in the next few steps, as well as the restrictions on eligibility on the account.
This step almost seems as if the whole process starts again, however, all the tabs are easy enough to work through. Once customers have worked their way through all five the tabs, they’re ready to start transacting.
What We Like About The Synchrony Bank Money Market Account
This is the ideal account to stick a few extra dollars in for a rainy day. It is the ideal savings builder as customers are not required to keep a minimum balance, but they can add additional funds to the investment. Furthermore, this is a great account for those who are just starting out on their savings journey as there is no monthly maintenance fee to provide for.
Customers have access to the funds when and where they need them and don’t have to place a notice of any kind. Furthermore, the account limits them to six transactions which provide a light measure to try and curb unnecessary spending.
Also, this account allows customers to enjoy a great interest rate from as little as a dollar. The rate also happens to be quite competitive, and many of the savings leaders in the industry are struggling to keep up.
Finally, the FDIC insures deposits according to the regulations, which allows customers some peace of mind.
What We Don’t Like About the Synchrony Bank Money Market Account
The account itself is a wonderful savings vehicle for those who wish to set aside some money for a rainy day. It is a pity that the bank is not as forthcoming about the restrictions and charges on the account as they should be. Customers will have to do a lot of digging to get to the terms and conditions and pricing on the account. Although there is no monthly maintenance fee, there are other charges on the account. Customers need to know upfront what these are.
Another detractor on the account is another small print item. If you don’t see it and miss it, the bank will cash in on some penalty fees. The culprit? The six-transaction limitation on the account. Although it is mentioned on the page, it’s once again a fine print item.
Critical Reviews Rating of Synchrony Bank Money Market – 7 of 10
There is nothing wrong with the product itself. It is a great item to have as part of a savings portfolio. However, the lack of proper communication with the customer regarding the restrictions throws up warning signs.
Customers who don’t know what to look for, won’t know where to find it. Unfortunately, there are competitors in this category that provide all their information upfront. This makes it easier to make an informed decision. Customers are not supposed to work for their accounts. The information on the accounts needs to be streamlined in order for this rating to go up as customers stand the chance to lose the growth on their savings due to a lack of knowledge.