6 ms·

People Put Nearly $1B into Apple Savings Accounts in First 4 Days

46 points by ourmandave 3y ago

0zemp2c 3y ago
for people who just want a place to dump their paychecks and have a credit card attached, this looks like a win the bar is set pretty low right now, maybe people are just better off running daily expenses through a stable company that isn't a traditional bank
- bsder 3y ago
  I always wondered what would finally take down Apple. Now we know it will be a financial arm. Every normal company that gets into finance eventually pays the price. At some point, that nice, profitable finanical arm will go into distress and the company will attempt to bail it out with funds from other arms. This cycle will repeat until it either kills the company or the financial arm after it has sucked down more money than you can imagine. Westinghouse and GE are more recent ones, but the list goes much further back.
  - Spivak 3y ago
    I think the fact that these are really Goldman Sachs accounts probably buys them some stability.
  - wallstprog 3y ago
    Maybe, but the actual "bank" in this arrangement is Goldman Sachs, and they are one of the more established players in finance.
    - JumpCrisscross 3y ago
      > the actual "bank" in this arrangement is Goldman Sachs, and they are one of the more established players in finance Cupertino is also hosing Goldman in this relationship [1]. [1] https://9to5mac.com/2023/02/16/apple-card-future-goldmans-sachs-losses/ https://9to5mac.com/2023/02/16/apple-card-future-goldmans-sa...
      - shagie 3y ago
        That needs to be put into context of the cost to acquire a customer. https://en.wikipedia.org/wiki/Customer_acquisition_cost https://en.wikipedia.org/wiki/Customer_acquisition_cost Various sources: $80 https://askwonder.com/research/average-customer-acquisition-cost-bank-pays-acquire-credit-card-customer-i-m-fy512dtei https://askwonder.com/research/average-customer-acquisition-... > The short version is that it costs around $80 to acquire a customer who returns about $120 in profit. https://medium.com/unifimoney/changing-the-vicious-cycle-of-push-to-pull-in-customer-acquisition-6218c8644000 https://medium.com/unifimoney/changing-the-vicious-cycle-of-... > It costs on average around $200 to acquire a credit card customer in the US (up to and beyond $1,000 if they are affluent cards like MasterCard World Elite and Visa Infinite). https://runningwithmiles.boardingarea.com/apple-card-customer-acquisition-cost/ https://runningwithmiles.boardingarea.com/apple-card-custome... > The Apple Card doesn’t need any affiliates or marketing yet analysts say that this new card has a customer acquisition cost of $350 and will take several years for Goldman Sachs to turn a profit on it. --- So the corresponding part of that is "we spent a lot to get a lot of customers. If they remain loyal, then GS will have something quite profitable for a long time." Spending $350 per customer is more than the $200 mentioned... but also much less than the $1000 for high end cards (and the tales of Chase Sapphire Reserve).
JohnFen 3y ago
Has anyone here done this? I'm curious about why. What's the draw for you?
- norgie 3y ago
  I haven't, but I'm guessing the interest rate (4.15%) on its own is a big draw
  - Our_Benefactors 3y ago
    It’s this. The biggest limitation I saw was that you can only transfer out $20k per 7 days, no wire transfers.
- overtfuture 3y ago
  I signed up, and it’s mostly the rate and the ease to have rewards just deposited right into the account. The daily cash account seemed to always be used to pay off the Apple Card so it’s nice to have something where the money just accumulates.
gumby 3y ago
I have read up on it but I don't get the appeal (i.e. what the benefits are). My US bank allows me to write checks (I don't actually have a checkbook, but I use bill pay which it will do electronically if it can and by issuing a paper check if not) and make various transfers, like Zelle. This has comparatively very limited payment capability. How would you pay your mortgage? There are even very strict restrictions on moving your cash out! It does have a higher interest rate than some banks, at least at the moment, but you can get these rates from competitors without the other limitations. In general all the current Apple banking offers (apple card, apple cash, apple savings account) seem pretty meh, and definitely far from great, much less "insanely great". The only Apple financial product I consider even worth remembering was financing your mac purchase back in 1984. It's also a weird space for Apple to get into: it's highly regulated, has limited (at best) connection/leverage/flywheel with the rest of their product line or company capability, and doesn't even use anything apple-specific (not even their enormous cash horde).
- fckgw 3y ago
  I have an Apple card. I had a few hundred bucks in Apple Cash I earned from cash back just sitting there doing nothing so I swept it off into Apple Savings so sit there and do nothing but at least earn a little interest on it. I'd imagine the majority of the new accounts have done this as well. It's a secondary, not primary, banking account.
  - aeadio 3y ago
    Were you not aware you could transfer that cash to a normal checking account?
    - catchnear4321 3y ago
      What normal checking account pays those rates? Sure, you could then bounce it to a savings account that pays those rates, or better. The rate isn’t everything. Apple created a very friendly path of least resistance.
- deleted 3y ago
blinded 3y ago
I put my emergency fund + some in betterment with the same savings rate years ago. It does pay off. Smart of apple to do this.
Agpilot 3y ago
I tried transferring $5000 out of my Apple savings account on March 1st. Its now Friday the 5th and I still don't have it in my external bank account. It says processing on Apples side. When I called Apple the said it must be my external bank not posting it. Bull! Next on the phone with Goldman Sacks. Their customer service sucks. 2 hours on the phone. Everyone said the same thing. It must be your external bank. Is this why on Apples end it says still processing? Finally, after 2 hours Goldman's account specialist said it was still transferring and could take up to 7 days. Not in 2023 I told her. And Apple claims it takes 1-3 days. Anyway, still waiting. 1: I will never put a penny into Apple savings again. 2: I will never do business with Goldman Sacks! Ever! Every representative has been taught how to pass the buck! Blame it one your external bank and get him off the phone. This type of business practice wont do Apple or Goldman any good. Lesson Learned!

46 points by ourmandave 3y ago

for people who just want a place to dump their paychecks and have a credit card attached, this looks like a win the bar is set pretty low right now, maybe people are just better off running daily expenses through a stable company that isn't a traditional bank

bsder 3y ago
I always wondered what would finally take down Apple. Now we know it will be a financial arm. Every normal company that gets into finance eventually pays the price. At some point, that nice, profitable finanical arm will go into distress and the company will attempt to bail it out with funds from other arms. This cycle will repeat until it either kills the company or the financial arm after it has sucked down more money than you can imagine. Westinghouse and GE are more recent ones, but the list goes much further back.
- Spivak 3y ago
  I think the fact that these are really Goldman Sachs accounts probably buys them some stability.
- wallstprog 3y ago
  Maybe, but the actual "bank" in this arrangement is Goldman Sachs, and they are one of the more established players in finance.
  - JumpCrisscross 3y ago
    > the actual "bank" in this arrangement is Goldman Sachs, and they are one of the more established players in finance Cupertino is also hosing Goldman in this relationship [1]. [1] https://9to5mac.com/2023/02/16/apple-card-future-goldmans-sachs-losses/ https://9to5mac.com/2023/02/16/apple-card-future-goldmans-sa...
    - shagie 3y ago
      That needs to be put into context of the cost to acquire a customer. https://en.wikipedia.org/wiki/Customer_acquisition_cost https://en.wikipedia.org/wiki/Customer_acquisition_cost Various sources: $80 https://askwonder.com/research/average-customer-acquisition-cost-bank-pays-acquire-credit-card-customer-i-m-fy512dtei https://askwonder.com/research/average-customer-acquisition-... > The short version is that it costs around $80 to acquire a customer who returns about $120 in profit. https://medium.com/unifimoney/changing-the-vicious-cycle-of-push-to-pull-in-customer-acquisition-6218c8644000 https://medium.com/unifimoney/changing-the-vicious-cycle-of-... > It costs on average around $200 to acquire a credit card customer in the US (up to and beyond $1,000 if they are affluent cards like MasterCard World Elite and Visa Infinite). https://runningwithmiles.boardingarea.com/apple-card-customer-acquisition-cost/ https://runningwithmiles.boardingarea.com/apple-card-custome... > The Apple Card doesn’t need any affiliates or marketing yet analysts say that this new card has a customer acquisition cost of $350 and will take several years for Goldman Sachs to turn a profit on it. --- So the corresponding part of that is "we spent a lot to get a lot of customers. If they remain loyal, then GS will have something quite profitable for a long time." Spending $350 per customer is more than the $200 mentioned... but also much less than the $1000 for high end cards (and the tales of Chase Sapphire Reserve).

JohnFen 3y ago

Has anyone here done this? I'm curious about why. What's the draw for you?

norgie 3y ago
I haven't, but I'm guessing the interest rate (4.15%) on its own is a big draw
- Our_Benefactors 3y ago
  It’s this. The biggest limitation I saw was that you can only transfer out $20k per 7 days, no wire transfers.
overtfuture 3y ago
I signed up, and it’s mostly the rate and the ease to have rewards just deposited right into the account. The daily cash account seemed to always be used to pay off the Apple Card so it’s nice to have something where the money just accumulates.

gumby 3y ago

I have read up on it but I don't get the appeal (i.e. what the benefits are). My US bank allows me to write checks (I don't actually have a checkbook, but I use bill pay which it will do electronically if it can and by issuing a paper check if not) and make various transfers, like Zelle. This has comparatively very limited payment capability. How would you pay your mortgage? There are even very strict restrictions on moving your cash out! It does have a higher interest rate than some banks, at least at the moment, but you can get these rates from competitors without the other limitations. In general all the current Apple banking offers (apple card, apple cash, apple savings account) seem pretty meh, and definitely far from great, much less "insanely great". The only Apple financial product I consider even worth remembering was financing your mac purchase back in 1984. It's also a weird space for Apple to get into: it's highly regulated, has limited (at best) connection/leverage/flywheel with the rest of their product line or company capability, and doesn't even use anything apple-specific (not even their enormous cash horde).

fckgw 3y ago
I have an Apple card. I had a few hundred bucks in Apple Cash I earned from cash back just sitting there doing nothing so I swept it off into Apple Savings so sit there and do nothing but at least earn a little interest on it. I'd imagine the majority of the new accounts have done this as well. It's a secondary, not primary, banking account.
- aeadio 3y ago
  Were you not aware you could transfer that cash to a normal checking account?
  - catchnear4321 3y ago
    What normal checking account pays those rates? Sure, you could then bounce it to a savings account that pays those rates, or better. The rate isn’t everything. Apple created a very friendly path of least resistance.
deleted 3y ago

blinded 3y ago

I put my emergency fund + some in betterment with the same savings rate years ago. It does pay off. Smart of apple to do this.

Agpilot 3y ago

I tried transferring $5000 out of my Apple savings account on March 1st. Its now Friday the 5th and I still don't have it in my external bank account. It says processing on Apples side. When I called Apple the said it must be my external bank not posting it. Bull! Next on the phone with Goldman Sacks. Their customer service sucks. 2 hours on the phone. Everyone said the same thing. It must be your external bank. Is this why on Apples end it says still processing? Finally, after 2 hours Goldman's account specialist said it was still transferring and could take up to 7 days. Not in 2023 I told her. And Apple claims it takes 1-3 days. Anyway, still waiting. 1: I will never put a penny into Apple savings again. 2: I will never do business with Goldman Sacks! Ever! Every representative has been taught how to pass the buck! Blame it one your external bank and get him off the phone. This type of business practice wont do Apple or Goldman any good. Lesson Learned!