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More Falling Savings Account and CD Rates

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More banks are cutting their rates. The Fed is holding its regularly scheduled meeting today and tomorrow, and many are expecting a 50 basis-point rate cut (see Bloomberg article). So these bank rate cuts will likely continue.

I've listed some of the most recent bank rate cuts below. These are from banks that have cut their rates since Saturday.
  • Corus Bank MMA - 4.75% APY (down from 5.00%)
  • WaMu Online Savings - 4.25% APY (down from 4.75%)
  • HSBC Direct Savings - 3.80% APY (down from 4.25%)
  • Citibank Ultimate Money - 4.25% APY (down from 4.50%)
  • Zopa 12-month CD - 4.50% APY (down from 5.10%) (my Zopa review)
  • Advanta Bank Corp 5yr CD - 4.40% APY (down from 5.00%) (my bank review)

If you find new rate cuts, please leave a comment.

  Tags: Citibank, Corus Bank, HSBC

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Comments
29 Comments.
Comment #1 by Anonymous posted on
Anonymous
Well, I think we can safely assume now that after the Fed cuts the rate again this week, the Savings and MMA Rates will drop below 4% eventually. Very sad indeed. Thank you, Bank Deals, for keeping us informed.

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Comment #2 by Anonymous posted on
Anonymous
AmTrust e-MM down to 4.5%

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Comment #3 by Anonymous posted on
Anonymous
One United Bank of Los Angeles is still at 5.30% APY. Amazing rate now that everyone else has lowered their rate so much. (They are now the highest of all banks.) I am afraid to switch right now because I feel as soon as I switch, One United will lower their rate. When will One United lower their rate, and by how much?

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Comment #4 by Anonymous posted on
Anonymous
Last year, I put $100K in ING's Electric Orange at 5.05%. I also put another $100K in WaMu Online Savings at 5.05%. Both ING Electric Orange and WaMu Online Savings are now 4.25%. I want to switch to someone else offering a higher rate, but I am also afraid that as soon as I do it, their rates will fall. I love One United's 5.30% APY, but I do not like the fact they credit interest quarterly instead of monthly, and I also think their rate will lower any day now, which is making me wait.

Any opinions on switching to One United? Thank you.

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Comment #5 by Dan and Vivian's Wedding BlogSpot (anonymous) posted on
Dan and Vivian's Wedding BlogSpot
I am super surprised that my Citibank account now has a higher rate than my HSBC account. :(

1
Comment #6 by Kevin (anonymous) posted on
Kevin
Zion Deseret MMA is down to 4.5% on balance over $100,000

1
Comment #7 by glxpass (anonymous) posted on
glxpass
I'm not planning to move my money anywhere until banks have had a chance to respond to whatever rate cut might occur at this week's sceduled FOMC meeting, which started today and ends tomorrow.

Most are expecting a .50% rate cut, but nothing is certain.

1
Comment #8 by Anonymous posted on
Anonymous
Wachovia Bank just lowered their 5-month CD to 4.25% APY. It was 5% yesterday.

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Comment #9 by Anonymous posted on
Anonymous
savingssquare.com still has their rate at 4.8%

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Comment #10 by SVG (anonymous) posted on
SVG
 

Readers,

Looks like 'saving' is fast becoming less and less attractive. *smile*

It is quite possible that many will find 'saving' to be quite a waste of their time/effort because the returns are going to be quite poor.

Perhaps there will be two outcomes:

1) Rather than 'saving' people will start 'spending'.

2) Rather than 'saving' in CDs/Certificates/Money-Markets people will start taking a little (more) risk and start 'investing' in bonds/mutual-funds/stocks/etc.

Either of the above outcomes may give the economy a kick-start, which perhaps is what FOMC will like. *smile*

- SVG
 

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Comment #11 by tresho (anonymous) posted on
tresho
Today Zions Bank Deseret MMF cut once again, lower than stated earlier, to 4.39% APY for accounts over 100,000, 4.24% APY for accounts 50000-99999.99, 4.18% APY for accounts 1000-49999.99, 0% for accounts less than $1000.

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Comment #12 by tresho (anonymous) posted on
tresho
UFB Direct's Absolute Savings accounts now pay just 4.5% APY

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Comment #13 by Anonymous posted on
Anonymous
HSBC's Jean Carrow, Vice President
Customer Relationship Center
was nice enough to email me to let me know the rate dropped to 3.80%. So my money is now on its way to AmTrust.

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Comment #14 by Anonymous posted on
Anonymous
SVG:

Good reasoning. Agree totally.

Feds are going to get the desired results.

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Comment #15 by Anonymous posted on
Anonymous
"Feds are going to get the desired results."

Probably, but that means the results the Fed desires, not the results fiscally responsible people desire. I wish they'd cut the meddling once and for all.

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Comment #16 by Anonymous posted on
Anonymous
There is nothing to *smile* about for those of us who do not want to put our money into the stock market. That is why I monitor this site so close. Thank you Banking Guy.

Agree, that the Fed should stop meddling. That is what our country into this financial mess to begin with.

Lower rates do have a downside to economy also. The lower the rates, the less money earned on CDs and MM Accts, the less we spend.

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Comment #17 by Anonymous posted on
Anonymous
svg- I want to add one more to your list.

3) Lots of homeowners who are paying high mortgage interest will refinance to lower interest. Whatever they save on mortgage payment they might spend!

I too like our FOMC.

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Comment #18 by Anonymous posted on
Anonymous
Hi Guys,

Digging up the junk mails that I have gotten in the past month. Found a promotion at HSBC for a CD. 4 Month CD at 4.60%. Min. deposit of 1000 (new money). Offer ends at Jan. 31, 2008. This is not advertise on their webpage. (From the banker instructions: The special product code is CD04.)

1
Comment #19 by Anonymous posted on
Anonymous
Guys,

FOMC's job is difficult.

If they don't cut rates, thousands of poor lenders will lose their homes. There will be criticism from everybody.

If they cut rates, thousands of "savers" will lose interest on their CDS. There will be criticism from everybody.

Are you getting the clue?

ME? I like job FOMC is doing. Kudos to Bernanke & others.

1
Comment #20 by Anonymous posted on
Anonymous
Read a report that the Fed will not stop lowering the rate until it gets down to 2.5%. This will be the bottom, and we will hit it sometime soon. Not this week, but soon.

1
Comment #21 by Anonymous posted on
Anonymous
I beleive the Fed is out to save the big financial institutions from themselves with all their dirivitives, back door dealings and hidden loses.

As far as individual home owners. Didn't they read their loan contracts before they signed the mortgage agreements? For the people that lost their jobs and can no longer pay the mortgage, they truly should be helped. As for the people who took out ARMs, well, that's gamble they took and lost. Just like playing the stock market. Some win, others loose!

For those of us who played it safe and sound, we are forced to pay the price with much lower interests rates on our savings.

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

    >>I beleive the Fed is out to save the big financial institutions from themselves with all their dirivitives, back door dealings and hidden loses.<<

Hmm ... I've heard this rhetoric repeated often enough. Reminds me of what our President used to repeat about Iraq and its cache of WMDs, which of course was not true.

Federal Reserve is serving us, the people, who have put it in charge of our monetary policy. It is not serving the financial institutes.


    >>As for the people who took out ARMs, well, that's gamble they took and lost. Just like playing the stock market. Some win, others loose!

      For those of us who played it safe and sound, we are forced to pay the price with much lower interests rates on our savings.<<


The folks who supposedly played it safe, actually have gambled. Their gamble is not as clear-cut as what happens when players actually play with a pack of cards. But gamble they did:

1) They gambled that the economy will stay steady and the financial institutes (the very same ones that they complain FED is out to save at their expense) will keep paying them steady/high interest.

2) They gambled by being a part of the very same economy as the folks who apparently took irresponsible mortgages. If a storm hits your neighborhood, then all the houses, those that are on 30yr fixed-rates and those that are on subprime-rates may be affected. (Same goes with economic storm.)

- SVG

 

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Comment #23 by Anonymous posted on
Anonymous
Yep, half percent - down to 3%. Let's watch our savings rates fall some more! :-(

1
Comment #24 by Anonymous posted on
Anonymous
Interesting comments SVG.

I had never thought of people putting money in CD as gamblers. But your comments do make sense. I think unwittingly everybody is gambling without realizing it.

Thanks for giving an entirely different perspective.

1
Comment #25 by SVG (anonymous) posted on
SVG
 

Anon,

    >>I had never thought of people putting money in CD as gamblers. But your comments do make sense. I think unwittingly everybody is gambling without realizing it.

      Thanks for giving an entirely different perspective.<<


You're welcome.

Folks who invest in CDs/Certificates are always at risk . This risk is not to their principal, but to the value of the principal at maturity. The risks involved are:

1) Inflation risk.
2) Tax risk.

Also the economies of the world have become very much interdependent. The economic 'butterfly effect' these days is visible not merely across your neighborhood. Events in your county / city / state / country / continent / world has a potential to affect value of your assets (negatively/positively).

- SVG

 

1
Comment #26 by Dan (anonymous) posted on
Dan
Just checked iGO. Dropped to 4.20 from 4.50 (%APY). Grrrr.

1
Comment #27 by Anonymous posted on
Anonymous
Just received a mail postcard from Wachovia offering a 4.50% APY Money Market Account. Must open account by Feb 28 2008. Says to call 800-987-2941 or visit financial center to open account.

1
Comment #28 by Banking Guy (anonymous) posted on
Banking Guy
Thanks for the tip on that Wachovia MMA. I called that number and the CSR only knew about a MMA promo with a 4.50% APY that ends today 1/31. It guaranteed the 4.50% APY for the first 90 days for a $10K deposit of new money. If anyone gets different info on this, please leave a comment.

1
Comment #29 by Anonymous posted on
Anonymous
Citibank Ultimate Money is now down to 3.75% APY....booo. Thanks Banking Guy for all the work you do on this blog! It is greatly appreciated by many who stumble upon the site. Your site is one of the top google hits for several search criteria (including #1 for bank deals, best bank deals).

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