CIT Savings Builder Review

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CIT Savings Builder

Overall Rating

9.5

Bottom Line

CIT Savings Builder offers an industry-leading APY. It’s also flexible, secure, and convenient — making it an attractive option that every saver should consider.

Pros

  • No Monthly Maintenance Fees
  • Easy Accessibility
  • Daily Compounding Interest

Cons

  • Interest Rates are Variable
  • Online Only

Service Fees

10.0

Accessibility

9.5

Interest Rates

9.5

Customer Service

9.0

One of the most common questions readers ask me is this: How can I maximize short-term savings?

Whatever your short-term goal is — whether it’s building a college fund, buying a home, or getting married — your plan should be to maximize interest in a way that gives you the freedom to move money around when you need to.

And one of the easiest ways to accomplish this is by using a program like the CIT Bank Savings Builder.

What is CIT Savings Builder?

CIT Savings Builder is a high-yield savings account (HYSA), meaning it’s a type of online savings account designed to reward customers with higher annual percentage yields (APYs) than a standard checking or savings account will provide.

HYSAs typically offer about 20x the national average for interest rates. In this case, CIT Bank is comparable to any leading HYSA that you will find through brand-name financial providers like American Express, Goldman Sachs (Marcus), Discover, and Capital One.

Of course, your financial situation is unique, and so it’s important to consider whether CIT Savings Builder matches your needs before getting started.

Let’s take a closer look to find out.

Pros of Using CIT Savings Builder

Here are some of the top features you’ll find in CIT Savings Builder:

No Service Fees

CIT Savings Builder doesn’t charge any account opening or monthly maintenance fees, which is a huge plus.

Some banks will try and slap on unnecessary costs if you don’t meet certain minimum deposit thresholds, which negates whatever interest you might earn. What’s the point of earning $30 in monthly interest if you get charged almost as much in fees? It makes no sense.

Banks often use fees as an incentive to try and get you to open a checking account or maintain a minimum balance. For example, Chase is one company that does this with its Premier Savings offering.

Easy Accessibility

When browsing for a HYSA that makes sense for your specific situation, something you’ll have to consider is whether the bank makes it easy to deposit and transfer funds.

Not all banks offer the same level of accessibility, and the last thing you want is to end up tying your money up only to find out the hard way that you can’t access it quickly in an emergency.

CIT Savings Builder offers a convenient mobile app, which you can use to deposit checks or make ACH transfers, which is a major advantage.

Daily Compounding Interest

CIT Bank Savings Builder offers daily compounding interest.

The thing to remember, though, is that just because you earn interest every day doesn’t mean you will see it right away in your account. Like many other online savings accounts, CIT Bank Savings Builder will credit you at the end of the month.

Still, it’s a good way to maximize your earnings.

Industry-Leading APYs

When it comes down to brass tax, the higher interest rate trumps almost all other features and selling points. Don’t get me wrong — no maintenance fees and awesome accessibility are important, too. But the point of using a HYSA is to get the most bang for your buck.

CIT Savings Builder currently offers a variable interest rate of up to 0.45% APY, if you maintain a balance of $25,000 or make $100 monthly deposits. This makes CIT Savings Builder a top rate offering that’s in line with any other HYSA on the market right now.

Key Considerations for Using CIT Bank Savings Builder

At this point, you may be thinking that this all sounds great. Sign me up! However, like any smart investor, you’re well aware that almost all good things tend to come with a catch or two.

Here are some important things to keep in mind before getting started with CIT Savings Builder.

You Have to Keep Up With Deposits

If there’s one thing I can’t stress enough when investing, it’s making sure that you’re in a position to contribute consistently over time. Your eyes may pop at the competitive rates being offered. But you have to understand that will mean taking $100 out of your paycheck every month — which isn’t an insignificant amount of money.

If you stop meeting the account’s requirements, your APY will drop. Right now, that figure is hovering around 0.45% — which is still a lot higher than what you will find at a run-of-the-mill savings bank, but it’s not optimal, either.

One problem that I have with this setup is that it can encourage complacency. For example, some savers may start out contributing $100, and then realize they drop down to $50, then $25, and so on, without seeing much of a difference at the end of the month.

Take my advice: Investing is all about discipline. Chart a course and stick with it. If losing $100 each month starts to hurt, find a way to increase your income by starting a side hustle, or getting a second job. This is the only way to achieve true financial independence.

Interest Rates Are Variable

Here’s another thing to remember about a HYSA like CIT Savings Builder: The interest rates are never fixed. If you want a fixed rate, you’ll have to explore a money market option like a certificate of deposit (CD). HYSA interest rates can drop unexpectedly and significantly.

This happens whenever the Federal Reserve cuts its interest rates, which is something that happened back in March of 2020. The Federal Reserve does this to spur economic growth. However, banks typically lower their APYs when this happens. Interest rates tend to shoot back up again when the Fed decides to increase its rates. And in this uncertain economic climate, there is no telling when this will happen.

The important thing to do is not to panic when the Fed cuts rates. In most cases, I advise people to leave their money in the HYSA until the tide turns.

And keep in mind: Traditional banks offer 0.09 percent interest on savings rates, which, to be honest, is an absolute joke. You’re not much better off than you’d be if you put your cash under your mattress.

It’s Online Only

If you’re the type of person who prefers having face-to-face interactions with bankers, a CIT Savings Builder account is not for you. CIT Bank is an online-only firm, meaning they do not have any brick-and-mortar facilities that you can visit.

If you are used to having a personal relationship with your local bank, I encourage you to rethink whether this strategy is best serving you or your financial institution. The job of a personal banker, after all, is usually to help their organization first and you second. They are great at getting people to open accounts, and they offer expertise in exchange for managing your money — making it harder to make decisions on your own.

The better move is to accept responsibility for your finances and partner with the organization that gives you the best rates and features. Anything less will be doing yourself a disservice, making it that much harder to achieve financial independence.

Transaction Limits

CIT Savings Builder is not a checking account, and shouldn’t be treated like one. This is a savings account, and like almost any savings account, there are monthly transaction limits — in this case, six — that you’ll have to abide by.

If you’re making more than six withdrawals from your HYSA on average, your money is probably in the wrong account. This type of account is designed to reward you for keeping your money in the bank. If you need more flexibility, move some money into a high interest checking account.

Fees

Since CIT Bank is an online bank, the company has very few overhead costs. As a result, they are able to provide services with little to no monthly fees.

One small fee to be aware of is they will charge a $10 outgoing wire transfer fee for balances that are under $25,000, which is pretty negligible.

While there are no startup fees, you do need at least $100 to open an account. In addition, there is no minimum account balance or balance requirement to worry about.

Getting Started

To open a CIT Bank Savings Builder account, you will need a few standard things, including a home address, zip code, valid email address, phone number, and Social Security Number.

The sign-up process only takes about 5 to 10 minutes, and there is no lengthy approval time. Most likely, you will be able to sign up and start funding your account immediately. It may take three or four business days to fund your account, though, depending on what bank you are using.

Promotions

Like most banks, CIT Bank sometimes offers partner promotions to incentivize people to open accounts. For example, Groupon has a few offers available where you can earn $300 or $150 cash bonuses whether you deposit $50,000 or $25,000, respectively.

Generally speaking, though, you should steer clear of these types of incentives. Truth be told, $300 is a pretty small kickback in the grand scheme of things. And $50,000 is also a lot of money to park in a HYSA long term.

If you have that much money on hand, consider diversifying your investments or look into long-term investing options like the stock market or real estate.

On the other hand, if you’re looking to move this money quickly, these types of incentives may be worth looking into. For example, you may be looking to put a deposit down on a house in a few months, and an extra $300 wouldn’t be the worst thing in the world to get with a major purchase like that on the horizon.

Security

Due to the current state of cybercrime, you may be skeptical about putting such a large sum of money into an online account. However, CIT Bank uses a variety of features to keep its customers’ money and information protected. Great!

For example, CIT Bank uses transaction and activity monitoring and layered security components to prevent hacking. Additional security measures include antivirus protection, firewalls, and 128-bit Secure Socket Layer (SSL) encryption, which is used to create a secure connection.

Additional security measures include secure messaging for customer service and automatic sign-outs after a period of inactivity. And in the event of bank failure, CIT Bank is FDIC insured for accounts with up to $250,000. In short, there is relatively little to worry about from a safety or security perspective, as long as you are smart about account hygiene and use a strong password.

Customer Support

While CIT Bank does not offer any physical branches, they do offer standard customer service offerings like you will find in any other financial institution, including a customer contact center. So, while you don’t get access to a local representative, you at least have people to turn to whenever questions arise.

In addition, the company offers a knowledge base with information with a variety of resources to help customers better understand the services they offer.

FAQs

Does CIT Bank Compound Daily?

CIT does offer compounding daily interest. However, interest is not paid daily. Interest is paid at the end of each monthly statement cycle.

How Do I Withdraw Money From CIT Savings?

Since CIT Bank only offers online banking, you won’t be able to withdraw funds from an ATM. However, you can transfer funds to a linked bank account at any time using an electronic transfer. Money can be deposited using an incoming wire transfer, by mailing a check, or directly through a mobile app.

Is CIT Bank Legitimate?

CIT Bank is a legitimate, FDIC-insured online financial institution headquartered in Pasadena, California. The only difference between CIT Bank and traditional competitors is that it operates entirely online, without any brick-and-mortar stores. There is no reason not to trust CIT Bank, or the CIT Savings Builder program.

Is The CIT Savings Builder Account For You?

CIT Savings Builder is an excellent choice for customers of all age groups and financial situations. The bottom line is that if you are looking to maximize your short-term savings, you are much better off going with this type of option than using a traditional bank that will charge higher fees and a much lower interest rate.

CIT Savings Builder offers an industry-leading APY. It’s also flexible, secure, and convenient — making it an attractive option that every saver should consider.

If your goal is achieving financial independence, CIT Savings Builder can certainly serve as a tool in your financial tool belt that can help you get there. That said, you won’t become a millionaire overnight just by opening an HYSA.

Still, a HYSA is a great place to park funds when you’re saving up to make a big purchase — like a down payment on a house or a car. It’s also a great place to stash your emergency fund because it earns among the highest interest rates of any bank online savings accounts available right now.

You know your savings goals better than anyone else. Do your due diligence, research the financial instruments that are available to you, and understand the importance of diversifying your investments. With patience, determination, and self-control, your journey toward financial independence is well within reach.

Additional Disclosures: Millennial Money has partnered with CardRatings and creditcards.com for our coverage of credit card products. Millennial Money, CardRatings and creditcards.com may receive a commission from card issuers. This site does not include all financial companies or financial offers. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.

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