The Capital One/Costco Online Savings Account has a yield of 3.75% APY for balances over $10K and 2.75% APY for balances under. As I mentioned on Saturday, this is the highest non-promo rate from a bank for a nationwide savings account (if credit unions are included it ties Alliant Credit Union).
This Costco Online savings account seems to have all the same features as Capital One's standard Online Savings Account, except it requires a minimum opening deposit of $5,000. After it is opened, there are no minimum balance requirements or monthly fees.
Capital One has long been offering a Costco Money Market Account with a yield that has always been between 10 and 30 basis points higher than the standard MMA. The current yield is 3.20% APY which is 20 basis points above the standard one. The MMA has the advantage over the savings account of having limited check writing (checks are free) and an ATM card.
In May I did an extensive review of Capital One's standard Online Savings Account. Please refer to that post for the account details. As I mentioned in that post, an important downside seems to be Capital One's slow ACH transfer speeds. Readers have reported that it takes at least 3 business days to complete. The money is pulled from the source account the day after you initiate the transfer, and it won't post until 3 business days later. Interest is lost during this time.
Another potential downside may be the customer service. Several readers have reported various problems in my May post and in this April CD post.
That April CD post also has some important details about Capital One's CDs. The Costco affiliated CDs have rates 5 basis points higher, however, there are fewer available terms. The most competitive rates are for the longer terms which include a 5.05% APY 60-month CD and a 5.35% APY 84-month CD. As I mentioned in that April post, Capital One has a convoluted way to determine the early withdrawal penalty which could result in an above-average early withdrawal penalty.
Capital One has two FDIC entities, however, I've been told that new accounts will be FDIC insured through Capital One, N.A. (FDIC Certificate # 4297). It's a large bank with $104.8 billion in assets and $69.5 billion in deposits based on 3/31/08 data. Capital One's rating at Bankrate has gone down to 3 stars (performing) based on 3/31/08 data. It had been 4 stars based on 12/31/07. The rating at BauerFinancial continues to be 3.5 stars (good) based on 3/31/08 data.