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E*TRADE Update - Rate Drops, Savings Account Bonus, Financial Health


E*TRADE Bank lowered the yield on its Complete Savings Account today from 4.40% APY to 4.10% APY. At least the yield remains above 4%. The yield on many other online savings accounts from banks like FNBO Direct, HSBC and GMAC have already fallen below 4%.

Even though E*TRADE has kept the Complete Savings Account rate competitive, their CD rates have gone way down. The only CD term with a yield above 3% is the 6-month term which has a yield of 3.40% APY. The CDs with terms over one year and under 5 years have a very low yield of 2.50% APY. So if you have E*TRADE CDs that are about to mature, make sure you don't let them automatically renew. You can do much better at many other banks.

New $25 Complete Savings Account Bonus

E*TRADE has a new $25 bonus for opening this Complete Savings Account. This new one is good through 3/31/2008. The terms seem to be the same including the requirement of only a $1 deposit to earn the $25. Here's the important small print:
$25 will be credited to your Complete Savings Account within 30 days of the account being funded with a minimum deposit of $1. Payments will be reported as interest income. Accounts must be opened by 3/31/2008 to quality for the $25 offer. Must be a new account opened with new funds. Offer applies to one new account per customer. Not good with any other offer.

Last year I received this $25 bonus without any problems. However, several commenters have mentioned that they had to call before the bonus was credited. So be sure to record when you sign up, keep a copy of the promo page, and if you don't receive the bonus within 30 days after funding the account, be sure to call.

E*TRADE's Financial Health

There have been many worries about E*TRADE since last November when reports of their subprime problems came out. But according to this Fortune article, things seem to be improving at E*TRADE. They even had success with their Super Bowl ad which was rated as the most-viewed commercial.

Complete Savings Account Review

E*TRADE started the Complete Savings Account in November 2006 (see post). The rate has remained more competitive than the rates at Emigrant Direct and HSBC Direct. The rate is lower than Countrywide Savingslink's rate, but unlike the Savingslink account the yield applies to all balances, not just balances over $10K.

Below is a list of features of the Complete Savings account based on E*TRADE's website, my experience, information from the CSR and from other references.
  • $1 minimum deposit to open account
  • No minimums or account fees
  • No hard credit inquiry (I didn't receive one)
  • Free online ACH transfer system (Quick Transfer)
  • Typical 6 withdrawal limits per month
  • $100K per day limit on outgoing and incoming ACH transfers
  • ACH transfers complete in one business day from my experience
  • Limits to the number of external links have been reported (see FW thread). The CSR wasn't aware of this.
  • 9 day hold time for initial deposit (ACH or check). No hold for wire transfers.
  • Holds on additional deposits are lifted on the 5th business day after the deposit

Thanks to the reader who emailed me info on the rate change.

  Tags: E*TRADE Bank, savings account

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Comment #1 by SingleGuyMoney (anonymous) posted on
Dang, I was hoping the rate wouldn't fall much further. Oh you said though, it is still above 4%.

Comment #2 by Anonymous posted on
I think the FW reference above re limits on external bank account links for E*Trade's Complete Savings account is in error.

I've had a Complete Savings account for the past year, and I've linked every other online bank account I have to it without any problem or limitation. My current list of accounts linked to the E*Trade account is somewhere around a dozen.

Their Quick Transfer feature to do ACHs in or out of other linked bank accounts is nice. But I've noticed they're also putting a funds available hold of three business days after incoming ACH deposits from outside accounts. --John

Comment #3 by Anonymous posted on
I linked 10 accounts total, I think. Then due to the Netbank -> ING changover, I had to make a change. I deleted the Netbank account, but then it wouldn't let me add the ING Electric Orange -- said I had reached the limit of external accounts. I even tried deleting another closed account, and it still wouldn't let me add. I think it said to call a CSR & they could do a manual add for me, though.

Comment #4 by Viv (anonymous) posted on
I was really disappointed in E Trade and just recently closed my account. They did credit my 25 bonus no problem, but I did an account transfer from my HSBC account to it on January 17th and it still hadn't transferred by the time I closed my account (Feb 8). I kept calling and sending emails and I couldn't get a straight answer from any CSR why the transfer was taking so long (one was that there was no activity on the account!). I just gave up and kept my money in HSBC.

Comment #5 by Anonymous posted on
I have 20 external accounts linked but I had to call them to disable the limit.
You can bypass 6 withdrawal limit by transferring your funds to Max checking first. It is good to have both accounts.

Comment #6 by larkin (anonymous) posted on
4.10% isn't bad given the current climate. I opened my account on January 14 and was caught off guard when I checked last Thursday (2-7) and the $25 bonus had been credited. No muss, no fuss.

Their ACH transfers are the fastest I've seen. Pulled money in Sunday night, it was credited in less than 24 hours later. Of course, it's on hold for a few days. Can't have everything.

Comment #7 by Anonymous posted on
Day #30 and still no $25 bonus. Emails to etrade told me to wait longer.

Comment #8 by Anonymous posted on
Funded the new account on 1-11-08 received the $25 bonus credit on 2-5-08.

Comment #9 by Anonymous posted on
Buy ETFC stock, you will be very happy, stock is severely undervalued and has been beaten down recently. Best stock for 2008! I am all in this one!

Comment #10 by Anonymous posted on
I opened the account and did not get the $25 bonus within the 30 days. On day 35, I sent a message online to etrade and they credited the $25 into my account in a couple of days. The ACH transfer system is quick and easy to link accounts. Verification deposits appeared in my other accounts one day after I sent them.

Comment #11 by Anonymous posted on
ETrade is very quick to pull your money in--usually it's there the next business day. But getting money out of ETrade is another story. Plan for three business days before it shows up in your linked account. That's intentionally and inexcusably slow.

Comment #12 by Anonymous posted on
follow-up to "Day #30 and still no $25 bonus. Emails to etrade told me to wait longer.":

After another email to etrade (the first one received the response that "the promotional code was not entered during signup"), my account was creditted with the $25 bonus by the end of the next day. I thought you only had to click the "$25 bonus" link when signing up; was there a promotional code you're supposed to enter during signup also? If something seems wrong, stay on them until they fix it.

Comment #13 by Anonymous posted on
I was able to transfer money into my account easily. However, when I tried to transfer it out of eTrade into my bank account, eTrade canceled the transfer. No explanation or attempt to speak with me--the transfer request does not show up under pending or history. When I send a secured email, eTrade said that they could not respond to me unless I sent a notarized letter to them. When I call customer service, they say I need to speak to another department that is only open 8 am to 6 pm EST. This is all very annoying.

Comment #14 by Anonymous posted on
Although eTrade says it is a bank and even has an office here in Chicago, when I went to the office to make a withdrawal, I learned that they cannot issue a check or cash to me directly. The people in the office must call into the 800 number to actually do anything. Checks must be mailed out or transfers done to linked accounts only.

Comment #15 by Wyliemoney (anonymous) posted on
I opened a complete savings account at the end of last year and they did not credit my account $25 within 30 days as promised.

Once I pointed this out, they credited me the next day.

I know bankdeals does not cover money market funds in brokerage accounts, but it is interesting to note that Etrade's Brokerage offers "JPMorgan Municipal Money Market Fund" which is tax free. It currently returns 0.64%. It was returning 2.70% as recently as 12/30/07.

I had much of my savings in my brokerage as it gave me over 3% after taxes, but I bit on Etrade's +5% offer! Well 5% may not have lasted, but I'm glad I moved my cash out of my brokerage. Less than 1% is terrible...

Comment #16 by Anonymous posted on
I had to wait 9 days because my max rate checking is "new account" even though I've had other accounts with etrade for a couple years. I emailed customer service and the 9 day hold is in the published policy; the FDIC does give them that option via "Expedited Funds Availability Act". However this is ETrade policy, most institutions do not have this requirement.

Fortunatly I did not need quick access to the funds.


As a side note: I just opened a Zion's Bank Deseret Money Market Account, and the funds were available in 3 days.