Dedicated to Deposits: Deals, Data, and Discussion

More Falling Savings Account Rates

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The cuts continue. Here are some of the latest banks to make cuts on their savings and money market accounts:

And reward checking accounts are also being hit (see previous post).

Amazingly, OneUnited's savings account is still holding on to 5.30% APY (see post). You have to wonder how long they'll keep this up.

Looks like all these changes will keep me busy updating the rates for my weekly summary. Thanks everyone for the comments about the latest cuts.
  Tags: savings account

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Comments
34 comments.
Comment #1 by Anonymous posted on
Anonymous
Hang on to your hats, or should I say your "money". The down draft is really going to catch on.

Unfortunately, we savers are going to pay the price for the greed and misdeeds in the coporate world of high finance.

1
Comment #2 by Matt Rogers (anonymous) posted on
Matt Rogers
Flagstar Online MMA Savings with Check Writing just dropped from 4.65% APY to 4.40% APY.

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Comment #3 by Anonymous posted on
Anonymous
Add AmboyDirect - down to 4.0% (was 4.55%).

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Comment #4 by Anonymous posted on
Anonymous
It's a bloodbath out there, people. And since the Fed will lower the rate again, this will continue. There are many people out there with $100,000 balances at several of the online banks. These rate drops equal thousands of dollars less per year in interest (which is taxable to begin with).

OneUnited only allows $40,000 total ACH withdrawl per month. Thanks to Banking Guy for this information. If one had a $100,000 balance at OneUnited, this fact could be very bad. This and the fact that OneUnited posts interest quarterly (and that they will lower their rate anyway) is keeping me from transferring some of my money to them.

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Comment #5 by Anonymous posted on
Anonymous
Presidential FSB, down to 3.5% (from ~4.25%)

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Comment #6 by Anonymous posted on
Anonymous
today I saw a ad about Millennium Bank, the rate is unbelievable high, it's Switzerland based, safe to open CD?
1 Year CD
> $5,000 6.25%
> $25,000 6.75%
> $100,000 7.25%

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Comment #7 by Anonymous posted on
Anonymous
Warning about Millennium Bank: Your money will not be insured. Yes, the US rates are now way too low, but at least you can sleep at night knowing that the FDIC will give you your $100K back, and relatively quickly.

Also, please note that if you do decide to put your money in a foreign bank, you must declare this fact to the IRS, and you will still have to pay taxes on the money.

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Comment #8 by Anonymous posted on
Anonymous
Millennium Bank is located in Kingstown which is the capital of St. Vincent and the Grenadines (SVG). This quiet, small group of islands has a history as an international private financial center dating back to 1976, when the first laws were passed to allow the formation of international companies, insurance companies, trusts and banks. SVG is self-governing, and has judicial independence and stable political and fiscal infrastructures, unaffected by changes in North American or European economies.

St. Vincent and the Grenadines is situated within 100 nautical miles of Barbados, St. Lucia and Grenada. Known as ''the jewels of the Caribbean'' St. Vincent and the Grenadines is a sovereign nation having achieved independence from Great Britain in 1979. It is a member of the British Commonwealth, the Organization of American States (OAS) and holds a seat in good standing at the United Nations.

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Comment #9 by Anonymous posted on
Anonymous
RE: Millennium Bank:

Premium Certificates of Deposit are NON-REDEEMABLE until maturity.

Premium Certificates of Deposit:

For the investor who is looking for an alternative to the low rates offered by most domestic banks, is looking for a guaranteed rate of return to avoid market fluctuations, and is willing to relinquish the option to redeem their investment prior to maturity in exchange for a higher yield, Millennium Bank offers Premium Certificates of Deposit. Please note that the interest rates for all certificates of deposit listed here are compounded annually and paid annually so that annual rate and annual yield are equal.

Premium Certificate Minimum Deposit Interest Rate
1 Year CD $5,000 6.25%
$25,000 6.75%
$100,000 7.25%

3 Year CD $5,000 6.50%
$25,000 7.00%
$100,000 7.50%

4 Year CD $5,000 7.00%
$25,000 7.50%
$100,000 8.00%

5 Year CD $5,000 7.25%
$25,000 8.00%
$100,000 8.50%

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Comment #10 by Anonymous posted on
Anonymous
there isn't an interest rate high enough to get me to park my hard earned cash in the caribbean.

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Comment #11 by Anonymous posted on
Anonymous
Just wanted to add Beneficial Bank in Lansdale, PA... A few weeks ago they were offering a 6% "guaranteed" 'til July 31, 2008 money market account, which I unfortunately missed and was very upset about...Just called today out of curiosity, and the rate has dropped to 3.75%... So much for "guarantees," huh?

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Comment #12 by virgquest (anonymous) posted on
virgquest
There have been some previous discussions on this site and other banking sites regarding Millennium Bank, most of which left me with the impression that it is a rather sketchy operation. I would encourage anyone considering opening an account with them to do some thorough research before doing so. Personally, I am wary of rates that sound too good to be true.

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Comment #13 by TheGipper (anonymous) posted on
TheGipper
Interest rates going down like a rock, costs of commodities (corn, gas, food, electric) going up like rocket..... can you say STAGFLATION?

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Comment #14 by Anonymous posted on
Anonymous
yes STAGFLATION.

Looks like CDs and MMKs are not good enough now. Where are you going to put your money?

1
Comment #15 by Anonymous posted on
Anonymous
ING Direct Electric Orange just lowered their rate to 4%.

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Comment #16 by SVG (anonymous) posted on
SVG
 

Anon,

    >>Looks like CDs and MMKs are not good enough now. Where are you going to put your money?<<

Indeed.

I've started putting monies in CA Bond funds already.

Fortunately, I'm in high federal tax bracket, therefore the tax benefit offered by Muni Bonds makes the tax-equivalent yield quite attractive.

Some of the Bond Funds I like are:
VCITX, USCBX, BCHYX, BCLTX.

I'm also considering some of the ETFs such as: CXA, PWZ.

Also in consideration is buying some Australian Dollars and/or Mexican Pesos. Yields are about 6.18% and 5.18% respectively for the corresponding ETFs.

Please note: For all of the above investments, the principal is not insured / guaranteed and neither is there any assurance of getting any yield.

- SVG

 

1
Comment #17 by Anonymous posted on
Anonymous
svg,

I did ask about everbank's foreign currency CDs a while ago. I think that you will have to pay 1% conversion fees. Is that correct?

1
Comment #18 by Anonymous posted on
Anonymous
I think someone on this blog had mentioned buying high div stocks. Any names?

1
Comment #19 by Banking Guy (anonymous) posted on
Banking Guy
For a discussion about Millennium Bank, please refer to this post. Also, reasons for sticking with FDIC/NCUA banks and credit unions are described in this post.

1
Comment #20 by SVG (anonymous) posted on
SVG
 

Banking Guy,

Provident CU has removed its special 16 month certificate. *sigh*

- SVG
 

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

Anon,

    >>I think someone on this blog had mentioned buying high div stocks. Any names?<<

It was not I, however check the components for the ETFs such as PID or PFM and you'll get names of lots of dividend paying companies.

See ===>
1) http://powershares.com/products
/holdings.aspx?ticker=PID

1) http://powershares.com/products
/holdings.aspx?ticker=PFM


- SVG

 

1
Comment #22 by Anonymous posted on
Anonymous
The last time I mentioned stocks on here I was labeled a gambler but after reading the comments here it sounds like some people are starting to look at other things that are not FDIC insured. I am not advising anyone to buy stocks or naming any stocks too buy. I am going to suggest a free web site [you may have to register to use it] www.quantumonline.com. They provide unbiased information on preferred stocks and other exchange traded income investments including REITS, ETFS, US and Canadian Royality trusts, closed end-funds and etc. Anyone interested in any of these investments should try this site as I found it very helpful. Happy rate hunting to everyone.

1
Comment #23 by Anonymous posted on
Anonymous
One thing to add about Millenium Bank...Banks world wide have been nicked by this sub prime paper budleing mess. Do you really believe Millenium has kept out of it? I would be careful because Millenium is known to invest heavily in the same things bringing down the rest of the financial sector.

1
Comment #24 by Anonymous posted on
Anonymous
I opened a CD at Patelco last week on Wednesday online when the rate was 4.80%. The next day the rate went down to 4.50%. When I went into the bank to fund the account they gave me the 4.8 rate but today I received a statement that the rate was 4.5. I called Patelco and they said the rate is established when you fund the account. That is not what I read here and was told when I first established the account. What should I do to get the higher rate?

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

Anon,

    >>When I went into the bank to fund the account they gave me the 4.8 rate<<

In my experience when you fund the Certificate at Patelco branch, they give you a receipt of deposit and a printout that has details of certificate such as amount deposited, rate, maturity date. If you still have that printout, then you have proof. Go back to the branch and show it to them and demand that they should correct the rate.

- SVG

 

1
Comment #26 by Bozo (anonymous) posted on
Bozo
My $.02:

I have abandoned any hope of making a "real" rate of return (i.e., a positive return after subtracting inflation and taxes) on taxable CDs until the Fed stops cutting rates. Until that happens, I doubt you will see any financial institutions eager to borrow your money at more than 50 basis points over the Fed Funds rate. Remember when the FedFunds rate was 5.25% and we were getting 5.75%? Well, it's now 3%, so 3.5% seems to be where most CDs are headed. If you can get more than that, I suppose you should be understanding, if not happy.

In all candor, always be diversified to prepare for times like this. And what cash you have, have laddered.

Look at the bright side; your financial stocks and bonds out-perform in this environment.

Yours,

Bozo

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Comment #27 by Anonymous posted on
Anonymous
I had $100K with ING Direct. I ordered a transfer of all my money from ING to my linked account. I am considering going with Countrywide, but I fear they too will lower their rate.

Obviously, a lot of other people besides me will pull out their cash from ING and others who have lowered their rates. Won't all this money pull-out hurt some of the banks?

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Comment #28 by Anonymous posted on
Anonymous
Quote: "Look at the bright side; your financial stocks and bonds out-perform in this environment."

Look at it another way: If the stocks a person holds were puchased before the market downturn, you may be still waiting for them to gain enough to break even, let alone making a substaintial gain to make up for the risks assosiati
ed putting money into the stock market.

At one time an indiviual could expect a reasonable rate of return being invested in the stock market.
Today, it appears to be a trader's market rather than invester's market.

Even if the economy gets it's act together, which I dought it will for quite some time, remember what happened to the market after 9/11.
Most people in or near retirement can't afford another hit like that and another six years to recover.

In some cases, it might be best to just accept the lower rates with insured CDs for now, depending on each persons sitiuation and time line.

1
Comment #29 by SVG (anonymous) posted on
SVG
 

Anon,

    >>At one time an indiviual could expect a reasonable rate of return being invested in the stock market. Today, it appears to be a trader's market rather than invester's market.<<

It sure does. And I'm sure the traders (yours truly included) are having a fun time. *smile*

On one hand it is sad to see that the opportunities in CDs/Certificates are decreasing, but on the other hand this turmoil is opening up lots of other opportunities in bonds/funds/stocks.



    >>In some cases, it might be best to just accept the lower rates with insured CDs for now, depending on each persons sitiuation and time line.<<

True.

Bozo here quoted 'Semper Fi' a while ago ... Well ... for SAS it is 'Who Dares Wins'. Perhaps that should be the motto for the traders as well !

- SVG

 

1
Comment #30 by Anonymous posted on
Anonymous
Printing Money to Avoid Immediate Banking Collapse
According to the Federal Reserve Board website, U.S. non-borrowed bank reserves have gone from $37B to $199M (nope, that's not a typo) in the last month. We have been discussing this with Sitka Pacific Capital's Mike 'Mish' Shedlock for the last two weeks. He concludes: "Banks in aggregate have now burnt through all of their capital and are forced to borrow reserves from the Fed in order to keep lending." Simply put, the U.S. banking system has no reserves. In addition, the FDIC has recently begun modernizing large-bank insurance rules. We hope this is a wake-up call to everyone as to the extent of the credit crisis. Bank account balances should be used only for transactions. Instead cash should be held in the form of U.S. Treasury Bills at a conservative brokerage or trust. Under the mattress is also perfectly acceptable (your parents or grandparents had to do it!). For investors, we advised last year to sell the banks. Banks will be soon forced to sell assets (yes, even 10 year Treasury Bonds) at deeply discounted prices to pay depositors.

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Comment #31 by Anonymous posted on
Anonymous
You saying we're all going to lose our savings?

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Comment #32 by SVG (anonymous) posted on
SVG
Anon,

Overall looks like you are quoting someone else, rather than expressing your own opinion. However it is true, that Federal Reserve has 'printed' money. This is one action of our FED, that I do not approve of, however collective knowledge our FED weilds I far more than my own, therefore I defer to them.

I am not too comfortable about this money printing matter, therefore I've decided to buy foreign currency. (I posted about it elsewhere in this blog.)


    >>Instead cash should be held in the form of U.S. Treasury Bills at a conservative brokerage or trust. Under the mattress is also perfectly acceptable (your parents or grandparents had to do it!).<<

I don't believe holding T-Bills (or T-Notes or T-Bonds) will be helpful. Holding US currecy under the mattress certainly won't be helpful either ! Imagine if you get up on Sunday and find out that the value of your Sunday News Paper is about equal to the US Currency paper you have under the mattress. *smile*

If one seriously believes that money printing has affected US currency negatively, then buying foreign currency - Australian Dollar, Mexican Peso, Euro, British Pound - might be one possible hedge. (See currencyshares.com if you want to know an easy way of buying foreign currency.)

- SVG

 

1
Comment #33 by Anonymous posted on
Anonymous
Oh here we go, The Sky is Falling, The Sky is Falling!

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Comment #34 by Anonymous posted on
Anonymous
"If one seriously believes that money printing has affected US currency negatively, ... "

rather, this may be why gold has hit over $900 ... it's not just US devaluation, but keep in mind all the OECD countries will take part in "competitive devaluation". Or the US dollar may become the next target of the carry trade; then, best to find which currency will be on the rise for that trade. But picking currencies is just like picking stocks -- they can go up and down as well. That's not the same as the concept of this blog of high interest yield with no possible loss of principal.
I would like to add my vote that the sky is falling ...

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