Dedicated to Deposits: Deals, Data, and Discussion

Bank Deals Weekly Summary for February 9, 2008

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Quick Link for Rates, Recap of this week's posts

I'm afraid the only good news for savers this week was that there wasn't a Fed rate cut. The next regularly scheduled Fed meeting isn't until March 18th, but there are some predictions that we may have another unscheduled meeting and rate cut before then. Even if that doesn't occur, it seems likely we'll get another 50-basis point cut on March 18th (see MarketWatch article).

Nearing the End of the 5% Online Savings Account

As would be expected in this rate environment, savings accounts continue to have large rate declines. Yields on many of the big online savings accounts have dropped below 4% APY. These include Emigrant Direct, FNBO Direct and E-LOAN.

There's now only one nationally available online savings account with a yield above 5%. The bank offering this yield is OneUnited. For the first time in more than a year, OneUnited did lower the yield, but it was only by 15 basis points (5.30% to 5.15% APY). It's likely that OneUnited will continue to gradually lower the yield. Many banks have decided to make many small cuts instead of one or two large ones. So it's hard to make a decision about a bank now just on savings account rates. Other considerations like account features and customer service should be given more weight, and OneUnited scores low on these (see post).

Even though there remains concerns about Countrywide, the bank's savingslink account has the best combination of high rate history and top savings account features. The savingslink account has a yield of 4.75% APY for balances over $10K.

Short Term CDs

CD yields of 5% are quickly becoming history. In fact, 4% yields are even becoming hard to find. For nationally available CDs, the best short term CD continues to be at Countrywide with a 4.75% APY 6-month CD. Countrywide had some local 5% 6-month CDs this week, but those have recently ended. The internet 6-month CD now has the highest rate.

Long Term CDs and Credit Unions

Even though rates are falling at credit unions, they're not falling as fast as they are at banks. So the best CD deals for terms of 12 months and over are at credit unions. The best deal for terms from 12 to 17 months continues to be at Alliant Credit Union with its 4.90% APY certificate which requires a minimum deposit of $25K (4.50% APY for $1K minimum). Alliant's 24-month CD is also on top of the list with a yield of 4.65% APY. Alliant also has a very competitive savings account with a yield of 4.35% APY for a minimum of $100 (see post).

For CDs with terms over 24 months, Pentagon FCU is near the top with yields ranging from 4.50% APY for a 36-month term to 5.00% APY for a 84-month term. The minimum deposit is $1K (see post). For a $40K minimum deposit, Western FCU has the best 36-month CD with a yield of 4.60% APY. For a $100K minimum, the yield is 4.75% APY. Northrop Grumman FCU has a yield of 4.84% APY on its 60-month CD with a $40K minimum deposit (see post).

These credit unions all have easy membership in that you can be eligible for membership by joining an association which is in the credit union's field of membership. The associations are open to anyone. Most of these associations have small yearly membership fees, but as with most any credit union, the qualification that allowed you to join the credit union doesn't have to be maintained to continue to be a credit union member. So you don't have remain in the association.

Reward Checking vs. Online Savings

This was another week in which the reward checking accounts are looking better and better. As the online savings account rates are being slashed, the extra work of debit card usage is becoming more tolerable as the rate advantage of these accounts grow. There continues to be several reward checking accounts that are still paying 6.01% APY. Most are only available in local areas, and most have a $25K cap on the balance that can earn the 6.01%. Nevertheless, with savings account rates starting to fall below 4%, these reward checking accounts are becoming more appealing.

The question remains if the rates on the reward checking accounts can hold. Some banks and credit unions have cut rates. I think the best we can hope for is that the average reward checking account will keep a yield of about 1% above the yield of the average online savings account. So six months from now, I think both 6% and 5% reward checking account yields will be very rare.

I hope I'm wrong on the future reward checking yields. New reward checking accounts continue to pop up with very high yields. I reported on one this week from an Indiana credit union that offers 7.01% APY for balances up to $25K (see post). I reported on one today from a Colorado bank which offers a 6.26% APY for balances up to $50K (see post). In addition to these, I reported on four other ones all paying around 6% (see the recap section below). So perhaps we'll see reward checking yields above 5% for many months to come.

Savings and CD rates are dropping fast. So please check with the bank or credit union to make sure the deals that I've posted are still available. If they're not, please leave a comment.

Recap for the Week

Banking News

Savings Accounts - National

CD Deals - National

Checking/Savings Account Bonuses

Reward Checking Accounts

CD and Money Market Deals - Local

The rates listed below are based on Annual Percentage Yield (APY). No minimum balances are required unless noted. MMA next to the rates indicate a money market account. Most MMAs have check writing and ATM cards. Online savings accounts usually lack both of these. The top lists include banks and credit unions with broad availability and with minimums around $10K or less. Previous weekly summaries are available for Feb 2nd, Jan 26th, Jan 19th, Jan 12th, Jan 5th, Dec 29th, Dec 22nd, Dec 15th and Dec 8th.

Quick Links: Refer to the following links for the savings accounts and CDs that interest you: Liquid Account Rates: Savings Accounts, Special rates, Local checking/savings, Bank alternatives CD Rates: 3 Mo CDs, 6 Mo CDs, 9 Mo CDs, 12 Mo CDs, 18 Mo CDs, 24 Mo CDs, 36 Mo CDs, 48 Mo CDs, 60 Mo CDs, 84 Mo CDs, CDs by state Comments: read and discuss

As of February 9, 2008

Checking/Savings/Money Market Accounts:


3-Month Certificates of Deposit:

6-Month Certificates of Deposit:

9-Month Certificates of Deposit:

12-Month Certificates of Deposit:

18-Month Certificates of Deposit:

24-Month Certificates of Deposit:

36-Month Certificate of Deposit:

48-Month Certificate of Deposit:

60-Month Certificate of Deposit:

84-Month Certificate of Deposit:

High Yield Reward Checking Accounts - Open to All

Checking and Saving Accounts at Local Banks/Credit Unions

CD Specials at Local Credit Unions/Banks Over the Last Month


Terms of 60 Months and Over

Terms of 24 Months to Under 60 Months

Terms of 12 Months to Under 24 Months

Terms of Under 12 Months

Bank Account Alternatives


Historical Rates from the Federal Reserve (Federal funds, Treasury bills, CD's)

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