Dedicated to Deposits: Deals, Data, and Discussion

Future Rates at FNBO Direct? and What's Next?

POSTED ON BY

FNBO Direct
A reader just forwarded me an email from FNBO Direct in which they stated that the yield after 9/28/07 will be 5.05% APY. This is below the pre-promo yield of 5.25% APY, however, I guess it's to be expected after last week's Fed rate cut.

So if you haven't already transfered your money out of FNBO Direct, what are your plans? I've listed some options you might want to consider.

Other Promotional Liquid Accounts

EverBank

EverBank has been offering a 3-month 6.01% APY promotion on its checking account since September 2006. In October of 2006 they also started offering this 6.01% promo on their money market account. I've been told by EverBank's customer service that both of these require you to be a new customer, and therefore, your can't string these together for a 6-month promotion. However, I've read about some people being able to do this so "your miles may vary". But with the Fed rate cut and future cuts possible, a 6.01% promo may not last too much longer. Please refer to EverBank promo post for more info.

Both the money market account and the checking account have some nice features. So these might be something you'll want to keep for the long term. The money market account has maintained a 5.01% APY for some time now.

UmbrellaBank

UmbrellaBank is still offering a 90-day promo of 5.50% APY on its Green Day Savings Account. Those lucky enough to get in on this early were able to lock in 6% APY for 90 days. The standard rate on this account is only 4.16% so it might not be something you want to keep. However, UmbrellaBank's Pot O'Gold Money Market Account has maintained competitive rates for years. Please see my UmbrellaBank promo post for more info.

AmTrust Bank

AmTrust Bank is offering a 5.50% APY guaranteed for 90 days on its money market account. This is not from AmTrust's online division AmTrustDirect so the money market account has standard rates more inline with brick-and-mortar banks rather than online banks. For more info on this, please refer to my AmTrust Bank promo post.

National City

National City is offering a 5.25% APY for 180 days on its money market savings account. You'll have to hurry on this one. It expires 9/30/07. It also has a $25K minimum to receive the 5.25% and is only available in certain states. Please see my National City promo post for more info.

Non-Promotional High Yield Liquid Accounts - Reward Checking

A high yield reward checking is one option for those tired of rate chasing if you don't mind using your debit card. Some banks are offering yields of up to 6.25% APY on these accounts. Most are only local deals, but there are a few that don't have geographic restrictions. Also, most have a maximum balance cap of $25K. Over that cap and the rate falls to something very low.

One bank that has a reward checking without geographic restrictions and without a balance cap is the State Bank of Toledo which is offering 6.01% APY. It's a very small bank, but after more than 2 months since my first post on this bank, they're still offering 6.01% without restrictions. Please see my State Bank of Toledo post for more info.

For other reward checking accounts in other parts of the country, please see my reward checking account page and my best checking account post.

Non-Promotional High Yield Liquid Accounts - Online Savings Accounts

Another option for those getting tired of rate chasing is to just pick a top online savings account. Some online banks that have a history of top rates include:
  • Countrywide savingslink: Current Yield: 5.50%, 5.25%+ for more than a year (see post)
  • UFB Direct's Absolute Savings: Current Yield: 5.31%, 5.27%+ for more than a year if you include the old High Yield Money Market Savings account (see post)
  • iGoBanking: Current Yield: 5.30%, Maintained 5.30% since it launched in Nov 2006 (see post)
  • Zion Bank's Deseret MMA: 5.30% (5.56% for $50K+), 5.30% maintained since Dec 2006 (see post)
  • AmTrustDirect e-Money Market: Current Yield: 5.21%, 5.21%+ for more than a year (see post)

Locking a Rate on a CD

With more Fed rate cuts a real possibility, savings account rates may continue to fall for many months. I'm sure many had wished they had locked into high rate CDs before 2001 when the target Fed funds rate fell from 6.50% to 1.75%. The next year probably won't be that bad, but it's something to consider.

I've listed several CD options in my weekly summary from last Saturday. However, a few options have already ended. Indymac Bank ended their 5.75% and 5.70% short term CDs yesterday. Countrywide Bank is still offering 5.65% APY on its one year CD although I've heard this might not last past Thursday. Western FCU and KeyDirect Bank still have some very high rates on their long term CDs.

  Tags: FNBO Direct, CD rates, savings account

Related Posts

Comments
34 Comments.
Comment #1 by SVG (anonymous) posted on
SVG
 
Banking Guy,

A few other options to consider are Money Market Mutual Funds and/or Tax-Exempt Money Market Mutual Funds.

No Mutual Funds is insured by the FDIC/NCUA, therefore some amount of caution is recommended. However, for those living in high state-income-tax states (CA / NY) might want to consider tax-exempt money market funds, especially if they are in high tax-brackets.

Depending upon one's tax-bracket, one may get 5.55% tax-equivalent APY or even higher! Of course one needs to project one's tax-bracket accurately.

All in all, perhaps these options are worth a look ...

- SVG
 

1
Comment #2 by Anonymous posted on
Anonymous
What about Indy Mac Bank's Money Market Account which is paying 5.59 with an apy of 5.75%....how long before indymac bank scales back the rate?

http://www.indymacbank.com/Individuals/Banking/page.asp?pSection=pdFRMMRate

1
Comment #3 by Anonymous posted on
Anonymous
Now that FNBO is back with the rest of the pack, their past behavior may come back to bite them in the butt. It may be okay to put up with that kind of stuff at 6% but not worth the trouble at 5.05%.

I wonder if a 3rd due diligence e-mail comes with that new rate...

1
Comment #4 by Anonymous posted on
Anonymous
Thank you for the FNBO heads up. At 5.05% I will be completely gone so fast it'll make their heads spin. My account is currently below $10, just waiting for the 10/1 outcome. With all their past shenanigans they will have to do way better than 5.05% to keep me on their ship. It'll be wonderful to be free of this bank. They are the worst bank I've ever encountered - by FAR.

1
Comment #5 by Anonymous posted on
Anonymous
Agree with SVG... There have always been higher-yielding money market accounts, but only recently have brokerages like Schwab and Fidelity started offering free ATM rebates and unlimited checks, making them a great alternative to traditional checking/savings accounts.

Both offer free overdraft protection, automatically selling positions to cover your checks/atm withdrawals/whatever. You just park your money in a fund that matches your acceptable risk level. Even if you're in the extreme low risk category, money market funds are historically as safe as cash, and regularly yield 5+%.

Sure, FDIC insurance is there in case your bank is insolvent, but SIPC insurance is there to cover insolvent brokerages. If there's a REAL run on the banks, a la 1929, sure the government would be there to hand out checks, but inflation would skyrocket as they printed money, making it meaningless.

1
Comment #6 by Anonymous posted on
Anonymous
I contacted Ever Bank. While their 6.01% promotion is still in check, they do a hard hit on your credit. They will not fund the account by ACH transfer. So transferring from FNBO to Ever will not work. They will not open the account until they receive the funds either by check or wire transfer. By the time a check gets there, the 6.01% may not be in effect, and if you have to pay for a wire transfer, there goes your yield! Any ideas, anyone?

1
Comment #7 by SVG (anonymous) posted on
SVG
 
Anon,

Do you have any favorites in Tax-Exempt Money Markets that offer unlimited check-writing without minimum check amount ?

I was not aware they offer ATM rebates. I guess I need to explore more.

I like Vanguard's - VCTXX. Tax-exempt yield is 3.62% for VCTXX. Calculator at link below will give tax-equivalent yield using one's Federal/State tax-bracket.

http://money.cnn.com/
magazines/moneymag/
money101/lesson7/index5.htm

- SVG
 

1
Comment #8 by Punny Money (anonymous) posted on
Punny Money
Bye bye FNBO. Not nice knowing you. Crawling back to HSBC I go!

1
Comment #9 by Anonymous posted on
Anonymous
Fidelity has some great options with their My Smart Cash account. The cash in the account is FDIC insured (3.5% APY), but you can buy money market funds in the same account, if you'd prefer the higher yield. No minimums, no fees, unlimited ATM rebates, unlimited no-minimum checks, overdraft protection, etc.

Fidelity has several tax-exempt money market fund options. The California tax-exempt fund is FCFXX. It's 7 day yield is currently at 3.26 vs Vanguard's 3.62. My preferred non-exempt Fidelity fund is FSLXX, with a 7 day yield of 5.18%.

1
Comment #10 by Anonymous posted on
Anonymous
Ken,

I'm suprised you didn't mention Indymac for an alternative to FNBO since it's next on your Saturday summary list of checking/savings/MMA.

Is it because it's not offered in all states? Does anyone know if it's offered in Arizona? Has anyone verified whether or not they do a hard credit pull?

1
Comment #11 by Anonymous posted on
Anonymous
I like Apple Bank's Grand Yield Direct with their 5.15% APY. They've treated me good and they respond to e-mails extremely quick.

1
Comment #12 by ProfessorB (anonymous) posted on
ProfessorB
Is this email from a reputable source?

1
Comment #13 by Anonymous posted on
Anonymous
FNBO managers treated me like crap and put their security concerns over my ability to access my money in a timely fashion. They lose $170,000 of my money. Buh bye.

1
Comment #14 by Steve Austin (anonymous) posted on
Steve Austin
I know that you folks have discussed the BoA affinity/expression accounts here. I looked today at the BoA-NEA affinity MMA and see that they have a 60-day intro rate of 6.18% APR. Since I have other BoA affinity accounts with a 5.30% APY, I think I'll avail myself of the 60-day intro 6.18% APR and then roll that to the 5.30% APY MMA after 60 days.

1
Comment #15 by Anonymous posted on
Anonymous
to steve austin:

where did you see that rate for BOA? I just chatted with them and they say they do not have any rates at 6" or above?

1
Comment #16 by Anonymous posted on
Anonymous
Everything is going down:

Salem eone checking
New Rates:

Balance APY
$0-$9,999 4.70%
$10,000-$24,999 4.80%
$25,000-$99,999 4.90%
$100,000-$999,999 5.10%
$1,000,000 or more 0.50%

1
Comment #17 by Anonymous posted on
Anonymous
Can you post the email that says the rate will drop to 5.05% APY? It seems strange that FNBO would reveal the interest rate to only this one person who got the email.

1
Comment #18 by Anonymous posted on
Anonymous
Not so strange. They also asked for copies of all W-2s from 1976-1982.

1
Comment #19 by Anonymous posted on
Anonymous
I just called FNBO to ask, and they said the rate would be 5.05% after Sep. 28. The rep didn't act like it was some deep, dark secret!

1
Comment #20 by Anonymous posted on
Anonymous
What about Indy Mac Bank's Money Market Account which is paying 5.59 with an apy of 5.75%? Does anyone have experience opening this account? Anyone at all?

1
Comment #21 by SVG (anonymous) posted on
SVG
 

Readers,

I've heard a few negative comments about IndyMac. I don't have personal experience.

OutSourced/Rude customer service, Incorrect and/or Delayed balance transfers.

YMMV.

- SVG
 

1
Comment #22 by SVG (anonymous) posted on
SVG
 

Anon,

>>Fidelity has some great options with their My Smart Cash account.<<

Indeed. I'm impressed. I opened mySmart on web-site. Took less than 10 minutes. Initiated a transfer from my Bank to fund it right away. Everything went smooth.



>>The cash in the account is FDIC insured (3.5% APY), but you can buy money market funds in the same account, if you'd prefer the higher yield.<<

I called and they mentioned that I'll have to open another brokerage account if I want to buy FSPXX. They mentioned that buying a mutual fund in mySmart is not possible.



>>No minimums, no fees, unlimited ATM rebates, unlimited no-minimum checks, overdraft protection, etc.<<

Very nice features indeed. They also have bill-pay and check-printing is free.

- SVG

 

1
Comment #23 by Steve (anonymous) posted on
Steve
Here's the link I used to open the BoA-NEA affinity account:

http://tinyurl.com/2xh4pe

I got it (pre-tinyurl'd) directly from a BoA on-line chat customer rep.

The intro (60 day) rate is MFR + 1.50 (last line on the yield table). Apparently MFR == 4.68%

1
Comment #24 by Bill (anonymous) posted on
Bill
Banking Guy,
Another option is to invest in GE Interest Plus. It is not a bank or FDIC-insured, but it is a liquid investment in AAA-rated bonds of General Electric Capital Corporation. The tiered interest rates are:

Less than $15k 4.91% APY
$15k - $49,999 5.17% APY
$50k and more 5.43% APY

You can invest and redeem funds quickly and easily via ACH [no long delays as with FNBO Direct] by phone or over the Web. You can write checks on the account if they are $250 or more. You can also have bills paid via ACH, and there is no minimum for that. They are also giving a $25 bonus for opening the account. I have had an account with GE Interest Plus for many years, and they are very reliable and convenient. Their Web site is:

http://www.geinterestplus.com/interestplus/gecapital.html

1
Comment #25 by Anonymous posted on
Anonymous
HSBC just lowered their rate from 5.05% to 4.5%. That's larger than the .50% by the fed.

1
Comment #26 by scott (anonymous) posted on
scott
Not sure why people are wasting their time looking to move money to one of the accounts that have no lowered yet, It's only a matter of time before they do. I am actually going to make more monthly interest because of these cuts. Since it's pretty clear we are not going see rates go up for awhile it's pushed me to start locking in CDs. In the last month I have got 5.55%, 5.65% and 5.75%. These are all higher than what my money was making before

1
Comment #27 by Anonymous posted on
Anonymous
FNBO DIRECT ARE NOT LETTING PEOPLE LOGIN TO THEIR ACCOUNTS

GMACBANK.COM is down

1
Comment #28 by Anonymous posted on
Anonymous
Anonymous at 6:35:

Seems to be working fine. Please dont create unnecessary panic.

1
Comment #29 by Anonymous posted on
Anonymous
I just received the mass email confirming that FNBO Direct will lower their rate to 5.05%. That's just not going to cut it with me.

1
Comment #30 by Anonymous posted on
Anonymous
so where do you put the $

I got the e-mail also

1
Comment #31 by ProfessorB (anonymous) posted on
ProfessorB
I got my email today. 5.05%

1
Comment #32 by John (anonymous) posted on
John
Regarding the inquiry about IndyMac Bank, I recently opened their First Rate MMA. It does have the 5.75% APY still on balances of $50,000 and above, but less than 2% for lesser balances. They also have not adjusted the rate since the Fed cut, so I'm waiting to see what will happen at this month end.

Here is the link to info about this MMA.
http://www.indymacbank.com/Individuals/Banking/page.asp?pSection=pdFRMMRate

They have been impacted by the real estate market downturn, but that's probably what's been pushing them to offer good rates. They do seem to have India or other foreign customer service, but so far my experience with them has been fine once you get past the accents.

One down side: Even though I had a pre-existing CD with them and an online account, they basically required me to make a branch visit to fund the account, since they wouldn't accept ACH funding in and I didn't want to take the extra time for mailing a check.

Even if they cut the rate some, it still would be a competitive account, provided you have $50,000 to put in. I was thinking about it as a resting place for funds while moving in or out of longer term CDs.

1
Comment #33 by Anonymous posted on
Anonymous
Is anyone having problems with FNBO ACH transfer system?

I have been trying to transfer funds since yesterday but I get this message:

"Transfer funds is not available at this time.Please, try again later"

1
Comment #34 by Craig (anonymous) posted on
Craig
you know, i wonder why some fidelity csrs tell you (like they told svg) that in order to buy a MM Fund, you have to open another brokerage acct, when in fact you can buy them within My Smart Cash!

My Smart Cash is a brokerage account and everything can be done within it except margin trading.

Personally, if you do investing also, i'd keep the seperate brokerage for that, which i have, but i also bought a position of MM fund within My Smart Cash as well, so that is a lot of bs...

I think they say that because they PREFER you keep Investments and Banking seperate with them...Still, their interface LETS YOU DO IT!

And the MM Fund within My Smart Cash will automatically Overdaft for the core checking, you don't even need to use their Cash Manager feature at all...

1