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Online savings

Question: I recently received a $25 check from ING DIRECT which I can deposit with them if I open an account in the "Orange Savings account." They claim to be members of the FDIC and they pay an interest rate of 2.75%. Re: deposits and withdrawals they say "you can move money automatically from your Orange Savings Account to your linked checking account and back." I'm nervous about doing this if this is not a legitimate company. I am 78 years old and cannot afford to make unwise financial decisions. Thanks for your help. Lois, Benzonia, MI

Answer: You're right to be cautious. Everybody should be with all the scams making the rounds.

But ING Direct is a legitimate company. (As I am writing this, the yield on the Orange Savings Account is down to 2.50% reflecting the overall decline in rates.) It's an FDIC insured online bank. ING and other online banks often offer slightly higher interest rates than their brick-and-mortar banking peers because they have less overhead. It's also a competitive strategy when many people are reluctant to do all their banking online. ING Direct is a subsidiary of ING, the Dutch multinational behemoth that is the world's 9th largest financial institution. You can learn more about the U.S. branch and its offering at its website, home.ingdirect.com.

You want to stay safe with your money, and take full advantage of the FDIC backing. . By the way, in today's low yield environment you can compare rates on other FDIC insured certificates of deposit and savings accounts (and the credit union equivalent) at a number of different places, such as www.bankrate.com.

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