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Simple Finance Review: An Online-Only Account With Built-in Savings and Budgeting Tools
In May 2021, Simple Bank was shut down with its accounts transferred to its parent company, BBVA, which is now part of PNC. If you’re looking for an online bank, check out our list of the best online banks for 2021.
The banking industry has moved online in recent years, and some institutions are killing it, while some are just keeping up with outdated, ill-functioning websites.
Financial technology companies have stepped in to address the issues with the dinosaurs in the industry and offer online-only banking products through feature-rich apps.
Simple is one such company that offers free checking accounts with built-in budgeting and saving features.
Here’s the nitty gritty on what we love (and don’t love) about Simple.
Simple is a financial technology company that offers online accounts that make saving, budgeting and spending money, you know, simple.
Unlike other online banking service providers or traditional branch banks, Simple offers a suite of banking products and integrated budgeting tools to help customers manage their money effortlessly.
Here’s what we like about the Simple Online Checking account:
Here’s what we don’t love about Simple:
Simple offers several features and a few account options, but they all start with signing up for a single Simple Online Checking account.
With that, you can open a joint checking account with budgeting features, and an individual or joint high-yield account, which Simple calls a Protected Goals Account.
Grade: B
The Simple Checking Account is designed to help you budget automatically, right inside your account.
All of your spending money lives in this one checking account (with a single account number), but you can organize it into customizable buckets:
The design takes a note from the classic envelope budgeting method.
You can open a checking account with no minimum deposit and pay no monthly maintenance fees, and the company does away with a lot of other traditional bank fees, as well.
Aside from the budgeting buckets, Simple’s Checking Account works like most checking accounts. You get:
Simple doesn’t offer direct bill pay services, but you can use your checking account routing and account numbers to set up automatic payments with service providers.
Simple doesn’t operate any brick-and-mortar bank branches or its own ATMs, so you have no way to deposit cash directly into the account. That makes it a poor option as a primary checking account for anyone who’s frequently paid in cash.
Grade: A
Simple offers two ways to save: a high-yield account and a no-penalty certificate of deposit (CD).
In addition to the short-term Goals in your spending account, Simple lets you create up to two Protected Goals that live inside a separate account (with a different account number) from your spending/checking account.
It’s not a traditional savings account, but technically a high-yield checking account that earns a variable interest rate, .50% APY as of September 2020. (Variable interest rates fluctuate with the market.) That’s 12.5 times higher than the national average APY for interest checking accounts of 0.04%, reported by the FDIC on Sept. 4, 2020.
You can add funds to your Protected Goals Account manually or automatically by:
Opening a Protected Goals Account is easy: Just start a Savings Goal in your Simple account. There’s a minimum deposit of only $0.01, and there are no hidden fees. You’ll see your Protected Goals Account balances alongside your checking account balance.
Because your Simple account is technically a checking account, it doesn’t face the typical restrictions on withdrawals you get with traditional savings.
You can transfer money out of the account into your checking account or into third-party accounts as needed. But, because Simple tucks it away from the money you use for expenses and spending, it’s easy to keep it out of sight and out of mind.
CDs are a way to guarantee a return on your savings.
You can purchase CDs of at least $250 and hold up to five CDs with a combined balance up to $250,000.
Simple CDs lock in a 0.70% interest rate for 12 months. After seven days, you can make an early withdrawal anytime of your full CD balance, including credited interest, with no penalty fee.
Grade: A-
Any online-only banking service tends to be convenient because of its mobile technology and 24/7 availability — as long as you don’t rely on in-person banking or cash deposits.
Simple doesn’t operate any brick-and-mortar branch locations, but it does give you access to live customer service through a phone line or online message feature.
From your account online or in the Simple app, you can see your transaction and deposit history; and manage your expenses, savings goals and linked accounts.
A Simple account gives you access to the Allpoint network of 40,000 ATMs for free. You can withdraw cash without paying a fee to Allpoint or Simple.
You can’t deposit cash via ATM.
Simple’s Shared Account option offers an added convenience for anyone who wants to use both an individual and joint account — for example, to set up “yours,” “mine” and “ours” finances in a relationship, or to share expenses with a roommate in an apartment. You can switch between accounts with one click and instantly transfer money between your individual and Shared Accounts.
If you prefer to use only a joint account, it’s a little annoying that Simple requires every user to open an individual account first. So, even if you only ever use the Shared Account, you and any other people on the account will each have an additional account in your names.
Grade: A
When it comes to mobile banking, an online-only option really has to go above and beyond. After all, it’s literally the only way you have to access and control your money.
Simple’s smartphone mobile app lives up to that mission, offering:
And perhaps more importantly, Simple takes security seriously, protecting your information with two-factor authentication to get into the app and bank-level encryption.
Still users rate the app relatively low: 4.1 out of five stars on Google Play and 4.4 out of five in Apple’s app store.
Simple doesn’t offer small business banking services. In the meantime, consider these alternative banks for small businesses:
Simple is almost completely fee free. You’ll only spend money on:
All other services are fee free, including:
Simple customer support is available by phone, social media, or through the website or app.
Simple also publishes a bunch of support articles that may help you find the answer to your question on your own.
Online banking service providers are confounding to many people, who wonder whether they’re safe and whether they can provide competitive service with no physical presence.
Here’s the low-down on what’s going on behind the scenes of your Simple account.
Simple is a financial technology company that provides financial services as a subsidiary of BBVA USA, a Member-FDIC institution.
BBVA holds and insures your money, and Simple provides the technology to make accessing and managing it easy.
Yes. Simple account funds are held by BBVA USA, which is FDIC insured up to legal limits.
BBVA USA (formerly known as BBVA Compass) acquired Simple in 2014, and Simple functions as a separate business within the international bank, the CEO explained in a blog post at the time.
Josh Reich and Shamir Karkal co-founded Simple in Brooklyn in 2009, becoming the company’s first CEO and CFO, respectively. The company headquarters is now in Portland, Oregon. David Hijirida has been Simple’s CEO since November 2018.
Like a traditional bank, Simple earns money through:
Why is BBVA willing to split its earnings with Simple? Because Simple’s user-friendly technology brings in new customers who prefer a convenient, easy-to-use, online banking service provider over BBVA’s own branch banks.
Unlike most financial companies, Simple has been slow to roll out products to complement its current products. Simple doesn’t offer mortgages or investing options.
In addition to its Simple Account (checking) and Protected Goals Account (high-yield checking) account, it offers a 12-month no-penalty CD.
For the convenience of robust mobile banking with a broader suite of products and services, check out these online banks:
Simple offers technological functionality that’s lacking with many traditional banks and even many competitor online-only providers. But it’s offerings are slim compared with most financial services companies.
Whether it’s the right fit for you depends on your lifestyle and financial goals.
Simple might be right for you if:
Simple might not be right for you if:
Interested? To open a Simple Checking Account:
The Penny Hoarder’s editorial team considers more than 25 factors in its bank account reviews, including fees, minimum daily balance requirements, APYs, overdraft charges, ATM access, number of physical locations, customer service support access and mobile features.
To determine how we weigh each factor, The Penny Hoarder surveyed 1,500 people to find out what banking features matter most to you.
For example, we give top grades to banks that have low fees because our survey showed that this is the No. 1 thing you look for in a bank. Because more than 70% of you said you visited a physical bank branch last year, we consider the number of brick-and-mortar locations. But more than one-third of you use mobile apps for more than 75% of your banking, so digital features are also considered carefully.
Ratings are assigned across the following categories:
Credit card and loan products are not currently considered.
Jamie Cattanach’s work has been featured at Fodor’s, Yahoo, SELF, The Huffington Post, The Motley Fool and other outlets. Learn more at www.jamiecattanach.com.
Dana Sitar contributed to this report.
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