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4.75% 60-Month CD and a New Way2Save Promotion at Wachovia

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Wachovia Bank
Wachovia has just started offering a 4.75% APY 60-month CD in some states. It doesn't seem to be listed at Wachovia's website even if you enter in your zip code. A reader mentioned this to me, and I just called for additional details. I was able to confirm a 4.75% APY 60-month CD in a Florida, Texas and a New York zip code (CSR requires a zip code for a rate quote). The minimum deposit is $5,000, and a checking account is required. The following is a list of the special CD rates that are available from at least Florida, New York and Texas:
  • 3.00% APY 18-month
  • 3.75% APY 36-month
  • 4.25% APY 48-month
  • 4.75% APY 60-month

There's also still a 3.15% APY 9-month featured CD with a $5K minimum in Florida. This is listed in the Wachovia CD page. Other states may have different rates and terms.

The 60 month term is long when there's risk that inflation will soon force rates much higher, but the smaller the early withdrawal penalty, the less risk of losing out if rates shoot up. Wachovia CDs with terms of one year or longer have an early withdrawal penalty of 180 days of interest. Terms over 90 days and under one year have a penalty of 90 days interest.

Last week the special 60-month CD yield was only 4.25%, so this is a sizable jump. The 4.75% APY is currently the top rate for 60-month terms with small deposits (see my latest rate summary). The fact that Wachovia is the fourth largest bank in the US by assets may be reassuring for those worried about the credit crisis. Wachovia's financials can be reviewed at their FDIC page.

New Addition to Wachovia's Way2Save Program

Wachovia has an added promotion on top of its Way2Save Program. It's tied to their sponsorship of the PGA Tour golf tournament, the Wachovia Championship. If the golfers do well, Way2Save customers will receive a bump in their interest rate. Here are the official details:
All Way2Save account holders as of May 30, 2008 will earn the 2008 Wachovia Championship winner's under-par score as their interest rate during June, July, and August. (APY for this period will not be less than the normal rate of 5.00%.)

From this tournament's history, it appears an 8-under par is reasonable to expect. So I assume this would result in an 8% interest rate for June through August. One thing to note is that you're limited to the amount you can put into the Way2Save account. Most will be lucky to have $600 in their account by that time. If that's the case, the extra 3% interest would only result in about an extra $5. Nevertheless, the Way2Save program is still a decent deal for small balances. Without this golf promotion, you'll earn 5% APY on your balance and receive a 5% bonus on your ending year balance. The easiest way to deposit into this account is to set up monthly automatic deposits of $100. If you do this you'll make about $72 more over the next year than what you would earn in a 3% savings account. Please see my Way2Save review for more details.

Wachovia Checking Account Bonuses

I haven't seen any new online Wachovia checking account bonuses lately. They've often had online checking account bonuses for $50. Let me know if you see a new one. When they have a new branch, they'll often have a $75 checking account bonus at that branch. I've reported on a few of these over the last few months. Please see my Wachovia deals page for the latest promotions.

Wachovia still does have a $25 refer-a-friend bonus for opening a checking account.

Thanks to the readers who mentioned the new CD special rates and this new Way2Save promotion in the comments. If you find some good bank deals or have other interesting banking news, please leave a comment in my finding-the-best-deals post.
  Tags: New York, Wachovia Bank, CD rates, Texas, Florida

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Comments
4 comments.
Comment #1 by Anonymous posted on
Anonymous
"The 60 month term is long when there's risk that inflation will soon force rates much higher"

Are there any thoughts from folks here or official projections as to what rates could go to and when this could happen?

What would have to happen to push the rates higher and how likely is this based on past history?

Thanks

1
Comment #2 by Cyclone (anonymous) posted on
Cyclone
They also raised their rate on their 2-year Step Rate CD. From the website (FL):

Time Tiers_______Interest Rates_____APY
Blended Yield_____0.00%_______3.26%
Step Rate Bump 6 Months__________3.13%_____3.18%
Step Rate Bump 12 Months__________3.28%_____3.33%
Step Rate Bump 18 Months__________3.43%_____3.49%

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Comment #3 by Anonymous posted on
Anonymous
Their terms are easily found on website and fair.

"Withdrawals of principal before your maturity date will result in a penalty... On terms of 365 days and greater, 180 days’ interest"

1
Comment #4 by Anonymous posted on
Anonymous
However the company just got caught.

NYTimes April 25, 2008:

The Wachovia Corporation, the banking giant, has agreed to pay an estimated $144 million to settle federal accusations that it failed to block telemarketers who took advantage of thousands of elderly bank customers...


NYTimes February 6, 2008:

Last spring, Wachovia bank was accused in a lawsuit of allowing fraudulent telemarketers to use the bank’s accounts to steal millions of dollars from unsuspecting victims. When asked about the suit, bank executives said they had been unaware of the thefts.

But newly released documents from that lawsuit now show that Wachovia had long known about allegations of fraud and that the bank, in fact, solicited business from companies it knew had been accused of telemarketing crimes.

Internal Wachovia e-mail, for example, show that high-ranking employees at the nation’s fourth-largest bank frequently warned colleagues about telemarketing frauds routed through its accounts.

Documents also show that Wachovia was alerted by other banks and federal agencies about ongoing deceptions, but that it continued to provide banking services to multiple companies that helped steal as much as $400 million from unsuspecting victims...

1