Comments

  1. Jason says

    Discover Bank claims that the routing number from Mango is invalid. That’s either suspicious or just plain annoying.

  2. Harry says

    Transfer-in from your bank to the card is automatic. If you don’t even want to log in once a month to move the $50 from the card to the savings account, you can also spend it down. Schedule a fixed dollar payment with say your cell phone provider and have them charge the prepaid card $50 every month. You lose $0.50 – $1.00 from credit card rewards you would otherwise earn. Not a big deal if you want to make it fully automatic/mindless.

  3. Steve says

    Sorry, but I have to ask: Why do you have to transfer the $50 from the card to the savings account as soon as it hits?

  4. serbeer says

    Same here:

    Not Found, Error 404
    The page you are looking for no longer exists.

    For people with, say, $50K in savings, great interest on $5K is something not to pass on. For those with more, I am not sure it is worth all the management hassles of handling additional account with unusual transfer conditions.

    Though it sure makes a great blog article so don’t blame you for going through with it.

  5. Harry says

    Steve – Short answer is you will save money if you do so. You can also spend the $50 down as I mentioned in comment #3 but you lose a small amount from credit card rewards. If you do nothing, you will pay yet a little more.

    Grant – Thank you. I fixed the link.

    serbeer – I used to think that way too. I ignored many seemingly small edges, until I realized that in a low interest rate world, these small things add up quickly, to the point where it can double the bond yield even on a $1 million portfolio. That’s why I started the BY2 series. It took me maybe 15 minutes to set up, and then 1 minute per month to do the transfer. Overestimating the hassle is detrimental to one’s wealth.

  6. Steve says

    FiveCentNickel explained it in his regurigation of this article: if you have a balance on the card on as of the 1st of the month, you’ll be hit with a $5 monthly fee for that month. Complicated indeed.

    It really, literally takes you only 1 minute to get a reminder, read it, log into a web site, and make a transfer? I’d put it at 5 minutes at a minimum – still not a lot, but 400% more than your estimate.

  7. Harry says

    It’s not the 1st of the month. It’s the date you opened the account. If I must use a stopwatch I would say 1 minute is plenty. Reminder comes automatically. The subject says it all. I type a URL, log in, click on a few places, then it’s done. Seriously if you don’t want to do the transfer every month, just let someone automatically charge $50 to your card every month. Then you will spend zero minute.

  8. Gregg says

    The website says that you need to sign up for direct deposit to get the 6% rate. Is that something new? Also, it doesn’t say that the $5/month fee is waived if your card doesn’t have a balance.

  9. Harry says

    The $50/month transfer from the bank account to the card is the direct deposit that qualifies the savings account for 6%. It doesn’t say they take only from what’s left on the card but that’s what’s happening in reality. Everything in the action steps is there for a reason. I waited until I tested everything out before I posted this article.

  10. Chad says

    “Although I only opened one account, you are not limited to just one per person.”

    Does that mean I can open 4 accounts (maybe more) for $5k each for a total of $20k earning 6% ($1,200) per year? Or, do they limit the 6% rate to your first account?

    Thanks, keep up the good work.

  11. Harry says

    Chad – I removed that sentence from the article. Because I promised to post from personal experience, I shouldn’t say anything I haven’t tried myself. If you are interested in having multiple accounts per person, please explore on your own but please keep the results to yourself. Some maximizers opening 10, 20, 50 accounts will eventually ruin it for everybody.

  12. Harry says

    boglestan reported the $5/month fee is now charged regardless. Those who think logging in once a month to move the money is too much trouble should be happy now. No more email reminders. Zero minute per month spent on managing it. Just leave the monthly deposits on the card and withdraw them once a year. I updated the post.

  13. serbeer says

    Yes, and he also reported that “it’s now effectively 4.8% interest, if you have a $5000 balance”
    Still not bad at all in today’s environment.

  14. Alex says

    I’m surprised nobody has mentioned this, but I’m rather new to the world of personal finance so maybe I’m missing a glaring problem here:

    Wouldn’t this account be a fantastic place to store most (if not all) of your Emergency Fund?

  15. Harry says

    Alex – Yes it would be. The only thing you may be missing is that most readers of this blog have more than $5,000 for their Emergency Fund. It makes sense to do the full $5,000.

  16. Andy says

    I have done step 1, but stuck in step 2. It has a “direct deposit” form. On the form, it gives a R/T number of 1149-9419-6. Is that the routing number? I tried using that routing number to transfer money to the account, but my bank’s website says it’s not a valid routing number.

  17. Andy says

    Yes, I did it without the dashes (actually my bank’s form only allows 9 digits for the routing number anyways). It seems like Jason from comment #2 has the same problem with Discover Bank (I use Wells Fargo). Let me try to look into this a bit to see if I can find the reason.

  18. Andy says

    I checked with the Mango customer service. They explained that “Wells Fargo has decided not to work with our company due to their own security measures”.

  19. Jason says

    The first time that I attempted to verify my Mango account as an external account at another bank, it failed and I believe it was because the bank was unable to withdraw the trial deposits because the initial account balance was negative. It might be advisable to first ensure there is a positive balance in the account using another deposit mechanism such as Paypal, which worked for me. After a second attempt I now have the account successfully linked.

  20. Chucks says

    Looks like they’ve changed it to require $500 a month in direct deposit to waive the $5 fee. It’s nice but just too much of a hassle when you realize the effective interest rate is a good bit lower. So either I park $5000 in there and deal with the fees cutting the interest down to 4.8% and interest that really doesn’t compound. Or I put in $5000 or so, have $500 go in a month from direct deposit and then spend $500 a month using the card.. I can’t think of any recurring credit card charge I could establish for $500 exactly, so I’d have the burden of logging in to make sure my spending was in the ballpark. Even if I did, I’d be giving up the opportunity costs of a 2% rewards card. Plus you really can’t get at the money directly without another $10 fee. In the end, I’d be getting around $20 a month back more or less guaranteed, which is nothing to sneeze at, but just not worth it when compared to the opportunity costs of other investments. It’s certainly a better alternative to any other savings account for people with between $2000-4000 to save.

  21. Harry says

    I moved your comments from another post to this one, where it belongs. Just pay the $5 fee. It’s not a big deal. I don’t know where the $2,000-4000 comes from. Where else can you get 4%+ guaranteed? If you are married, each can have $5,000 in separate accounts for a total of $10,000.

  22. Maxly says

    I just opened my Mango account. I’m curious about #26′s comment as I haven’t used Mango yet and don’t quite ‘get’ a couple things.

    Harry, can you tell me.. if I keep $5,000 in the Mango savings account for the good interest rate. Can’t I simply transfer via ACH $500 every month and then transfer over $500 as ACH “direct deposit” to avoid the $5 fee and also keep the good interest?

    I’m confused how comment #26 makes it sound like it would be impossible to get money out of the account without paying a $10 fee. I mean, why would I need to put money on the card anyways. From what I understand, a $500+ “ACH” direct deposit into the savings account should avoid the $5 monthly fee.

    Thanks and hope to get your reply.

    • Harry says

      You don’t have direct access to the savings account. Must go through the card. See diagram in the post.

  23. Maxly says

    Then how do you avoid it from going over the $5,000 limit if you can’t transfer out? I thought on the web site it says “six (or five?) withdraws out” allowed per month? What is that in reference to?

    • Harry says

      You don’t avoid it. I already addressed it in the article. 6 transfers refer to transfers out to the card.

  24. Maxly says

    So if I have $5,000 in the savings account. After interest gets added to the account it’ll obviously go over the $5,000 limit. So then the only option I have is to transfer anything over $5,000 to the card to avoid the interest rate going from 6% to 2%?

    • Harry says

      No. The $50/month ACH deposit to the card gives you 6% on the $5,000. Balance over $5,000 earns 0.1% but your $5000 still earns 6%. Follow the steps in the article.

  25. Maxly says

    Thanks for the reply. Forgot to mention.. love the site.

    Is it $500 or $50 ACH transfer (“direct deposit”) per month to get 6%?

  26. Harry says

    No but they are not going to make a big difference. If you gross up the $5 fee to $7.50, or even $10, it’s still a good yield.

  27. Tom says

    Any idea why routing number is not recognized by my bank and how to use the PayPal option to load the card/ account. Thanks for detailed steps for the process but now stuck on routing number, my both banks do not recognize that R/T. Please help. Thank you,

  28. theo says

    “We are unable to process your request at this time. Some of the identification information you provided could not be validated”… wtf?
    Finally called them and it went through with the same info… go figure :)

    • Harry says

      Tom – No idea why some banks don’t like that routing number without dashes. Outdated database maybe? It’s valid. My credit union has no problem with it. Maybe we should start a list for which banks recognize it and which ones don’t.

      Recognize: Alliant Credit Union, Chase (must bring balance to positive first), ING Person2Person

      Don’t recognize: Wells Fargo, Discover Bank, Ally, Bank of America, Popmoney, ING DIRECT (ACH)

  29. theo says

    Yeah that could be a problem.. You need to find a financial institution that you use that can link to the Mango account. BTW the Mango routing number links to INTER NATIONAL BANK.

    I may be able to load cash through my fidelity cash management account as it does not have a trial deposit verification system. It will take 7-10 days to find out though :)
    Looking at the list above, my Chase trial deposit verification will probably fail… I am also trying Vanguard though they also use trial deposits…

    What about sending a check with the initial contribution or at least a small sum to move the balance into positive territory?

  30. Harry says

    Tom – I put the banks that recognize the routing number and those that don’t into the article body. Hopefully other readers will help expand the lists. I would suggest trying a brokerage or mutual fund company such as Fidelity or Vanguard. Maybe they are less picky.

  31. Hans says

    1) TIAA Direct works fine for ACH.

    2) A way to avoid the $5/ month fee is to direct deposit $500/month and then use Amazon payments (funded by the mango card) to pay this + monthly interest to your spouse/significant other. It can then be deposited to a bank account. I’ve done this previously to hit sign up spending targets on credit cards. Nice way to get the money back (with no fees) and not take away other usual credit card rewards. (Although technically, I guess you could be using a 2% rewards card w/ amazon payments every month)

  32. Juliana says

    Why not just make $500 deposit per month to avoid the $5 fee.. and keep doing that until you reach the $5,000 limit.

    Possible?

    Also, having said that already.. I made my first $500 deposit to Mango Money in December but the $5 card service fee hasn’t been returned yet. What’s up with that? Does it take extra time for them to return the $5 service fee? I thought the service fee is waived with a $500 deposit.

    Harry? Any advice on this?

  33. Harry says

    Juliana – Because with $5,000 in the savings account from the get-go, you get about $25 interest every month ($24.88 posted to my account at the end of December). That’s much more than the $5 fee. If you only have $500 in the first month, you get only $2.50 interest ($22.50 opportunity cost). Next month when you only have $1,000, you get $5 interest (another $20 opportunity cost). Next month, … you get the picture. Don’t get so hung up on the $5 fee. Pay it; it’s worth it. I didn’t get the $5 fee for the first month returned to me. I’m OK with it.

  34. Justin says

    If my bank does not allow me to set direct deposit then I get 2% pay.
    Is there a way to get around this with PayPal and get 6% apy?

  35. Justin says

    Also note that 6% apy applies only to direct deposit and not any other transfer(ACH) is what I understand, as stated on their website, so how come transferring from bank qualifies for 6%

  36. Harry says

    Justin – I read on another forum PayPal didn’t work. The account added as a bank account to PayPal was removed because PayPal doesn’t allow it. Use a different bank, ideally one that’s already confirmed working, for example CIT Bank.

  37. Justin says

    Harry, Thanks for your reply. I am thinking to open Chase account, do you know if that would affect my credit score?

  38. Harry says

    Sorry, no idea. I opened several bank accounts in 2012, especially in Q4. My score didn’t appear to be affected much. I guess it depends on what score you have now.

  39. theo says

    In my experience Paypal, Vanguard and Fidelity CAN be linked to Mango.
    OTOH Chase gave an error presumably due to negative balance and Cap1 doesn’t recognize the routing number, both already reported above.

  40. Charlie says

    Navy Federal Credit Union accepts the routing number and can be linked to the Mango account. NFCU doesn’t use small deposits to verify the account, so there is no problem with the negative balance. It’s only possible to ACH $2,500 out of a NFCU checking account per day, so it takes a few days to fill up the Mango account. Also, unless you have access to a NFCU branch, you have to wait for a verification letter to come in the mail with a confirmation code to link the external account.

    Is there any reason you suggested to start the monthly transfer 40 days after opening the Mango account?

  41. Harry says

    Charlie – Thank you for the info about Navy Fed. The 40 days is not that important. Because you need an ACH deposit every month to keep the 6% rate, the initial $5,000 load will satisfy that requirement for the first month. Then the monthly transfers starting in 40 days will satisfy it for the following months. If you start it sooner, you just have extra $50 on the card. No big deal.

  42. Trevor says

    I loaded $50 using Capital One 360′s P2P (previously ING). It was listed by Mango as “EFT Load – CapitalOne….. ”

    Does this mean they are not considering it as direct deposit?

  43. Trevor says

    Thanks Harry. I’ll post an update on how it goes, since it looks like 6 months have passed in the discussion above.

    • Trevor says

      Wire transfer fees? The loading method should be ACH.

      ACH is free and it is the method which employers pay you.

      I doubt Mango would actually accept a wire.

    • Harry says

      It’s not a wire transfer but Bank of America still charges $3 for a transfer to an outside bank when most other banks don’t charge. Use a different bank or send a portion of your paycheck over. Most employers can direct deposit to multiple bank accounts.

    • DTC says

      I thought I could just transfer from my bank instead of asking for my employer to deposit into multiple accounts. If it’s the only way, I’ll see if I can do this.

      Thanks!

  44. Washerdreyer says

    I’m getting the same “We are unable to process your request at this time. Some of the identification information you provided could not be validated,” that Theo reported above. CSRs say they are unable to help or explain anything, that they can’t access the enrollment side if things for security reasons. Anyone have any advice?

  45. J says

    Thank you for writing this guide. I am in the process of setting up an account at Mango now.

    The only possible inconvenience I see is that Mango, like ING Direct, does not offer a way to define a beneficiary in case something happens to the account holder. I’m relatively young and don’t expect anything untoward to happen to me while I hold this account, but I thought I should mention it for those who have not yet taken the plunge.

  46. Trevor says

    If you’re so concerned about something that unlikely, just leave a note somewhere with your login and card details so your family could find it..

  47. Cher says

    Sallie Mae banking accepts First Bank & Trust. It also does not withdraw the random deposits.

    It’s also possibly worth mentioning that Mango prepaid can be used to pay certain bills. I don’t ACH out to my bank acct directly, but I have been using that excess $500 + interest to pay a credit card bill from the credit card website every month.

  48. Shak says

    “If you are married you can get one card for each person. That will make it equivalent to $15k earning the 3.9% rate.”
    $5k for each will be $10k for a couple right? Or did I miss something?

    • Harry says

      From the article: “After all said and done, taking into account the initial $5,000 plus the $500 per month deposit to waive the $5 monthly fee, you end up getting a 3.9% yield on an average balance of $7,800.” You have $5,000 earning 6% plus $500/month earning 0.1%. Assuming you withdraw once a year down to $5,000, the blended rate is 3.9% on $7,800 for the full year. $7,800 times two is $15k.

    • Cher says

      But why would you only pull out once a year? There are so many other banks out there with better rates that you can just ACH out once a month or use to pay a credit card bill, etc.

    • Harry says

      @Cher – Pulling out once a month versus once a year makes very little difference. At 1% interest rate, it’s about $30 a year before tax. Not worth pushing it in my opinion.

  49. Trevor says

    As an update, my local bank which uses Popmoney integration for bank-to-bank transfers now recognizes the routing number and successfully transfers funds to my Mango account. So any bank that uses Popmoney, including large institutions like PNC and Ally, should now work.

    • Cher says

      This is great info! I’m going to US Bank or Ally to see. It would nice if I could just reroute money instead of having to do monthly DD from my job.

    • Cher says

      Neither Ally nor US Bank PopMoney recognized the routing number yet. Maybe in the future it will trickle up to them.

  50. Kevin says

    does the prepaid debit card get a routing and account number? Can I schedule a reoccurring payment against that account? Why would one not just place 5k in the savings account, direct deposit your mortgage in the prepaid debit account to satisfy the monthly DD requirement, and then have your bank pull the mortgage from there each month?

    • Trevor says

      Yes it does get an account and routing number. Moving money from the 6% savings account to the debit portion of the card would not satisfy the direct deposit requirement, it needs to come from another bank or an actual employer. The savings account is internal and does not have it’s own account number, it can only be accessed by first putting money in to the debit portion of the card and then transferring it instantly.

  51. john says

    Did anyone receive a 1099 from Mango or Union Prepaid. It is tax time and I just realized that they have not mailed me the form. Tried looking online but could not find a place to download the forms

    • Harry says

      I received it in January. Mango and Union Plus were combined on one 1099-INT under the name of Rev Worldwide. See if you have one from Rev Worldwide. Otherwise call customer service.

    • john says

      Thank you Harry. I just checked and I do have it :-) Using a different name and also combining both on 1 form was confusing.

  52. Jerry says

    Apparently, Bank of America doesn’t work with that routing number either. Doesn’t surprise me, Accenture built and maintains their IT infrastructure for BOA.

    One thing, their App isn’t available in the US Itunes store. I think they’re able to offer this interest, because they’re off shoring the money, and avoiding paying US taxes on any profits they received from deposited funds. This way they can repatriot money by paying part of their profits back in the form of interest earned, albeit a higher interest. Pretty smart if that’s their business model :)

    • Trevor says

      I’ve had their app before from the US app store (iPhone). I did uninstall it because I didn’t use it actively and I see you are correct that it is not on the app store right now. It might have been pulled for an update. They are a legitimate Texas company though, I got a 1099-INT statement from their parent company named Rev Worldwide, Inc. or something.

    • Trevor says

      Their business model is probably making the $5 fee that the majority of their users pay each month, but whatever their business model is doesn’t really matter to me since it’s FDIC insured. I’m glad you commented though, because I will look in to whether that FDIC insurance covers the 6% savings account now.

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