Question

Which of these is a reason someone might choose to open an online savings account rather than a savings account at a traditional bank?

Responses

Online savings accounts are FDIC insured to a higher limit
Online savings accounts are FDIC insured to a higher limit

Online savings accounts typically pay higher interest rates on deposits
Online savings accounts typically pay higher interest rates on deposits

Online savings accounts are less likely to make you the victim of identity theft
Online savings accounts are less likely to make you the victim of identity theft

Online savings accounts are created specifically for people under age 25

Answer 1

The most relevant reason someone might choose to open an online savings account rather than a savings account at a traditional bank is:

**Online savings accounts typically pay higher interest rates on deposits.**

Online banks often have lower overhead costs compared to traditional brick-and-mortar banks, which allows them to offer more competitive interest rates on savings accounts. The other options either contain inaccuracies (like the FDIC insurance limit being higher) or are not typical reasons for choosing an online savings account.